GRcade

BBC News wrote:Npower facing backlash over energy price rises

Energy regulator Ofgem has said Npower must "justify" to its customers why it is introducing one of the largest energy price rises for years.

The government also said it was "concerned" by the increase, while a former boss of Npower called the rise "shocking".

The company will raise standard tariff electricity prices by 15% from 16 March, and gas prices by 4.8%.

A typical dual fuel annual bill will rise by an average of 9.8%, or £109.

Npower said the changes would only affect about half of its customers. The other half are on fixed-term deals and will see no price rise.

The rise in electricity prices is thought to be the largest since 2008, when some suppliers increased charges by up to 19%. Some gas prices went up by a similar amount in 2011.

Comparison website Uswitch said the rise for dual fuel was the largest for a big six supplier since 2013.
Justification

Npower blamed increases in wholesale energy costs and the cost of delivering government policies such as smart meters and the renewables obligation.

The wholesale cost of electricity has risen by 36% since last April.

However, Ofgem said suppliers could easily avoid consumer prices rises by buying energy at forward prices.

"We don't see any case for significant price increases where suppliers have bought energy well in advance. Npower must therefore justify the decision to its customers," a spokesperson said.

The government too joined in the criticism, saying it was "concerned by Npower's plans to increase prices for customers who are already paying more than they need to."

The spokesperson for the Business and Energy department went on: "Suppliers are protected from recent fluctuations in the price of wholesale energy, which they buy up to two years in advance, and prices remain significantly lower than in 2014."

Former Npower boss Paul Massara - who now runs an alternative energy company - called the rise "shocking" in a tweet.

'Difficult decision'

The announcement comes after three other suppliers - British Gas, E.on and SSE - announced they would keep prices on hold until the end of March.

EDF cut its gas prices by 5.2% last month, but will raise electricity charges by 8.4% from 1 March.

Npower said it was the first time it had raised prices for three years.

"This is a hugely difficult decision, and we've delayed the date this takes effect until after one of the coldest months of the year," said Simon Stacey, Npower's managing director of domestic markets.

However, 1.4 million customers on existing standard tariffs will be offered a four-year fixed-price tariff with a 4.8% discount.

Pre-payment customers will not be affected by the increase, and 80,000 people who receive a warm home discount will in effect pay no increase until May.

Daily Moan wrote:Two-thirds of E.On customers could see their energy bills soar after the supplier today announced an 8.8 per cent fuel price hike from next month.

The energy giant said its standard electricity prices will increase by an average of 13.8 per cent and standard gas prices will rise by an average of 3.8 per cent.

Around 2.5million of E.On's residential customers - 62 per cent - will 'potentially' see an increase if they take no action before April 26, the company revealed.

E.On - whose increase follows a spate of recent energy price rises - said its rise was 'due in large part to increasing policy costs and other costs it doesn't control'.

It also said that the hike was 'largely due' to an increase of around 36 per cent in the cost of supporting various social and environmental programmes, such as the Renewables Obligation (RO) and Electricity Market Reform (EMR).

Tony Cocker, chief executive of E.On UK, said: 'This is the first time since January 2014 that we have increased our standard variable prices.

'It is an announcement we never want to make but is due in large part to the fact that many of the costs we don't directly control, such as policies including EMR, RO and the Energy Company Obligation (ECO), which are paid for via people's energy bills, are increasing.

'We have been able to partially offset some of these rises through our wholesale hedging policy and other means, but we do have to make an increase.'

He added: 'We will continue to work to make sure our customers are on the best tariff for them; for example, we will be sending more than three million letters to customers this month with personalised savings messages making it clear how easy it is to swap to another tariff that might offer cheaper prices.

'In addition we will also be working to contact a number of potentially vulnerable customers currently on our standard variable tariff with a personalised quote for an exclusive product, which will be E.On's cheapest tariff.'

E.On's rise follows various companies increasing energy prices in recent months.

Lagamorph wrote:I'm still expecting announcements of Record Profits from all of the big 6 this year.
God forbid profit margins take a hit instead.

I don't understand the obsession that companies have with making sure profits are increased every year. Surely as long as you're still actually in profit by a decent amount, it shouldn't matter if it's higher or lower than the previous year.

Saint of Killers wrote:How long before all the other, big energy companies do the same and then cry foul when the 'C' word is used to describe them?

KKLEIN wrote:I'd like to see the whole lot nationalised. There is no 'service' to be had.

Qikz wrote:strawberry float my life. This is who I got into a contract with last september.

Errkal wrote:

KKLEIN wrote:I'd like to see the whole lot nationalised. There is no 'service' to be had.

It should be, it is something you need to have so shouldn't be something someone can make masses of profit overtaking the piss.

Water, Electricity, Gas and soon some could argue internet should all be publicly owned for at the very least non-profit

Ironhide wrote:Transport should also be re-nationalised, there's too many companies charging excessive fees for sub standard services and the general public are being screwed over in the name of profit.

Ironhide wrote:

Errkal wrote:

KKLEIN wrote:I'd like to see the whole lot nationalised. There is no 'service' to be had.

It should be, it is something you need to have so shouldn't be something someone can make masses of profit overtaking the piss.

Water, Electricity, Gas and soon some could argue internet should all be publicly owned for at the very least non-profit

I agree entirely.

Transport should also be re-nationalised, there's too many companies charging excessive fees for sub standard services and the general public are being screwed over in the name of profit.