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Business News

Scottish and Southern Energy raising price

Millions of customers of Scottish and Southern Energy face higher bills from September after the group became the third of the major suppliers to raise prices.

The group is to increase gas prices by an average of 18% and electricity prices by 11% from September 14. The increase will mean a typical annual dual-fuel bill will rise from £1,094 at present to £1,265, an increase of £171.

Scottish Power and British Gas have already announced price hikes and like its rivals Scottish and Southern, which owns Southern Electric, Swalec and Scottish Hydro, said its decision reflected higher wholesale gas prices, a higher cost of using energy networks and the cost of social and environmental schemes.

SSE, which has 5.2 million household electricity customers and 3.6 million household gas users, added it will not raise prices again for households until August 1, 2012.

Chief executive Ian Marchant said: "I am sorry that we have had to announce an increase in household energy prices at a time when many people's budgets are under strain, but the upward pressures on prices have become too great."

Since its last gas price increase, in December, wholesale costs of electricity and gas have risen by 23% and 40% respectively, he said.

Consumption had also fallen sharply since April 1 due to the mild weather, with households using 2.9% less electricity and 5.8% less gas.

Profits for the first half of the year will be below the comparable periods in both 2009 and 2010, though SSE said this will have no implications for the full financial year.

The firm added that it is "on course to deliver a dividend increase of at least 2% more than RPI inflation in respect of 2011/12".

"As in each of the last three financial years, SSE will invest more than it will make in adjusted profit before tax in 2011/12," Mr Marchant said.