More big increases in energy prices

The Energy firms Scottish Power and Npower yesterday announced steep rises in their gas and electricity prices.

Scottish Power announced it would increase gas prices by an average 34 per cent and electricity prices by 9 per cent from Monday. Prices for Npower's gas customers would increase by an average 26 per cent, with prices for electricity customers up by 14 per cent, with immediate effect. The firms have 11.8 million customers between them.

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Both blamed soaring wholesale costs, saying they had made current pricing levels unsustainable. They are the last of the country's suppliers to hit households with increases, following moves by British Gas, EDF, E.ON and Scottish & Southern.

The average gas customer faced an average annual increase of £162, said Npower, with electricity bills rising by around £60. The firm claimed that until today its domestic gas prices had been the same as prices 18 months ago but wholesale costs had doubled.

Electricity generation has also been directly affected by soaring raw materials prices, which had increased by 122 per cent for gas and coal and 79 per cent for oil over the last 12 months.

The managing director of Npower, Giuseppe Di Vita, said: "We've made this decision reluctantly, especially as household budgets are being squeezed. There is help for people who can't pay their bills and we want customers to get in touch if they're worried."

Scottish Power said the average dual fuel customer would see bills increasing by 25 per cent. About 1.2 million customers were protected by fixed-price tariffs, it said. Willie MacDiarmid, the director of energy retail, said: "We understand the impact this announcement will have on our customers. We have worked very hard to protect people for as long as possible from considerable increases in the wholesale market."

The fuel poverty charity National Energy Action estimated the latest price rises would push one in five households into fuel poverty. Its chief executive, Jenny Saunders, said: "It is imperative that the Government announce a comprehensive package of measures to help people who face a desperate struggle to pay fuel bills. We cannot allow millions of households to go cold this winter."