E.ON to put prices up by £54 or 4.3% for standard dual fuel direct debit customers and £15 or 1.1% for cash and cheque customers from 18th January
Move ends a wave of winter price hikes by Britain’s big six energy suppliers, averaging £92 or 6.8% and adding £920 million on to household energy bills
Reduction to levies expected to shave £330 million off again but some suppliers say they won’t pass on the benefit until Spring 2014
The average household energy bill has soared from £1,353 to £1,445 a year, and is expected to drop to £1,412 a year once the cuts are passed – an £890 or 170% increase in a decade
Uswitch.com is urging suppliers to pass on the levy reductions immediately so that all households can feel the benefit throughout winter.
E.ON has today become the last of the big six energy suppliers to announce a price hike. The increase of £54 or 4.3% for standard dual fuel customers paying by direct debit and £15 or 1.1% for cash and cheque customers comes into effect on 18th January and takes E.ON’s average dual fuel cash and cheque bill from £1,370 to £1,385 a year. The move brings to an end a wave of winter price hikes that have averaged £92 or 6.8% and have added £920 million on to household energy bills.
Like EDF Energy, E.ON has already factored in the recently announced reduction in Government levies on bills, which has allowed it to increase its prices by less than originally planned. Customers of other big six suppliers are less fortunate, having seen far bigger increases, which many will have to bear into 2014.
SSE, npower and ScottishPower are yet to confirm details of when and how they will be applying the reduction to customers’ bills. However, British Gas has confirmed that it will be cutting its prices on the 1st January, which will result in £48 a year coming off its standard dual fuel tariff for cash and cheque customers.
Once the remaining suppliers cut their prices, the average household energy bill is likely to be £1,412 a year, shaving £330 million back off bills again. However, this still leaves consumers facing bills that are £59 or 4.4% higher than at the beginning of the year after the last round of hikes had taken effect.
It also means that consumers will have seen an £890 or 170% increase to energy bills in a decade. And, at £1,412 a year, consumers will also be step closer to the £1,500 tipping point at which almost four in ten households (36%) will be forced to turn their heating off entirely.
Ann Robinson, Director of Consumer Policy at Uswitch.com, says: “This round of price hikes has added to the burden for consumers struggling to afford to stay warm. The Government has tried to lend a hand, but suppliers now have to play their part too. They must do the right thing by passing the cuts on to their customers ASAP so that households can feel the benefit throughout winter. Suppliers that are unable to provide this much-needed relief this year should backdate it so that customers don’t lose out.
“However, consumers also need to understand that even with this reduction, their bills will still be higher. This is why they must continue to fight their own corner by ensuring that they are paying the lowest possible price for their energy. The Government reduction is welcome, but it’s small change compared to the price cut you could get by switching to one of the cheapest tariffs on the market.”
Average household energy bills:
|
British Gas
|
£1,340
|
£1,471
|
23/11/2013
|
£1,423
|
1/1/2014
| |
EDF Energy
|
£1,332
|
£1,384
|
3/1/2014
|
£1,384
|
N/A
| |
E.ON
|
£1,370
|
£1,385
|
18/1/2014
|
£1,385
|
N/A
| |
npower
|
£1,352
|
£1,491
|
1/12/2013
|
£1,441*
|
TBC 2014
| |
ScottishPower
|
£1,368
|
£1,480
|
6/12/2013
|
£1,430*
|
TBC 2014
| |
SSE
|
£1,354
|
£1,460
|
15/11/2013
|
£1,410*
|
March 2014
| |
Average
|
£1,353
|
£1,445
| |
£1,412
| |
Source: Uswitch.com
Based on a medium user consuming 3,300 kWh of electricity and 16,500 kWh of gas on a standard dual fuel tariff, paying quarterly by cash and cheque, with bill sizes averaged across all regions. *Based on DECC’s calculation that reductions will be worth £50 on average.
E.ON announcement Friday 6th December, 2013.
Based on a medium user customer using 3,300 kWh of electricity and 16,500 kWh of gas, on a standard Dual Fuel plan, paying quarterly by cash or cheque with bill sizes averaged across all suppliers and all regions.
Uswitch.com estimates 10 million standard plan customers based on 26 million households and Ofgem statistics showing that 7 million customers are on price guarantee plans, 3.5 million are on online tariffs and 4 million electricity customers and 3 million gas customers on PPMs. The average increase for a customer on a standard plan, based on a medium user profile using 3,300kWh of electricity and 16,500kWh of gas paying on receipt of bill, averaged across all big six suppliers, is £92. Taking this increase over 10 million standard plan customers totals £920 million added to consumer bills. The £330 million is calculated in the same way based on British Gas’ announced reduction of £48 and that npower, ScotttishPower and SSE will apply the average £50 reduction assumed by DECC – see table in release above.
See table in release above.
Based on a medium user customer using 3,300 kWh of electricity and 16,500 kWh of gas, on a standard Dual Fuel plan, paying quarterly by cash or cheque with bill sizes averaged across all suppliers and all regions. Bill size in January 2004 was £522 a year. Bill size in 2014 once the levy reductions are applied is likely to be £1,412 (see table in release above).
Based on a medium user E.ON customer using 3,300 kWh of electricity and 16,500 kWh of gas, on a standard Dual Fuel plan, paying quarterly by cash or cheque with bill sizes averaged across all regions.
Research carried out in September 2011 with the Uswitch.com Consumer Opinion Panel amongst 2,295 adults with bill paying responsibility for gas and electricity in their household. The £1,500 affordability tipping point is the point at which there is a marked difference in consumer behaviour. This is based on responses to the following question: ‘Following recent price increases, the average household energy bill is now over £1,200 a year. How much would your yearly energy bill have to be before you would consider the following actions….’)
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