uSwitch.com: EDF hiking prices for gas and electricity

Britain’s fifth largest energy supplier, EDF Energy, has announced that it is putting up prices from this Friday, 18th January, 2008. The increases – 12.9% or £74 for gas and 7.9% or £28 for electricity – will impact standard tariffs and will affect over half its 5.5 million customer accounts. It will add an extra £100 on to the average dual fuel customer’s household energy bill, which is now set to rise from £907 to £1,007.

For EDF Energy customers it means further pricing misery after enduring a three year run of price increases when dual fuel bills rocketed by 73% or £409 (2004 – 2006). This came to an end last year when the giant dropped prices by 10% or £66,for its gas customers, but it was one of the last suppliers to do so and today’s move completely wipes out last year’s decrease after only 7 months of lower prices. EDF Energy will now be Britain’s second most expensive supplier.

As the second of the big six to announce a price increase, EDF Energy is entering the fray at a time of growing scrutiny with calls for suppliers to justify sweeping price rises. Consumer campaigners have highlighted that energy prices soared across the board by £277 (38%) on average between 1st January 2006 and 1st January 2007, but prices were only cut by £101 during 2007, despite a 56% decrease in wholesale energy prices. While 15 price rises in 2006 added £4.8 billion to consumer energy bills, price cuts in 2007 only shaved off £1.7 billion.

Ofgem, the industry regulator, has however said that there are no plans to refer energy firms to competition authorities: “We can only take action if we find evidence of anti-competitive behaviour.”

Ann Robinson, Director of Consumer Policy at uSwitch.com, comments: “Consumers are again being asked to accept an inflation busting price hike at face value without the courtesy of a detailed, clear and logical explanation. The industry has yet to provide any degree of transparency about how household energy bills are calculated and what costs consumers should legitimately be asked to shoulder. Companies are gambling on the vast majority of customers sticking with them regardless of how much they end up paying for their energy. This is blatant cashing in on loyalty.

“All people really want to know is whether they are being treated fairly or not but, with household energy bills heading back up over £1,000, they cannot afford to hang about waiting for an answer. Consumers must take action now and move to a cheaper energy deal if they want to protect their household from the impact of higher energy bills. By not switching consumers could waste savings of up to £325.”