E.On hikes gas and electricity prices by 4.8% for 1.8m customers

Bills to jump £55 a year for dual-fuel customers

E.On blamed ‘sharply’ increasing costs for the price rise, which comes months after the company made ‘structural changes’ to its billing in March, effectively increasing the average bill by £22 (Getty)

E.On will hike gas and electricity prices for 1.8 million customers in August, just months after the supplier removed a number of discounts.

Bills will jump 4.8 per cent, or £55 a year, for dual-fuel customers on E.On’s standard variable tariff from 16 August, the company announced.

Electricity will cost 6.2 per cent more, or £36 extra per year for the average household, while gas customers will pay an additional 3.3 per cent – £19 more per year.

E.On blamed “sharply” increasing costs for the price rise, which comes months after the company made “structural changes” to its billing in March, effectively increasing the average bill by £22.

Chief executive Michael Lewis said he hoped that those adjustments would mean E.On could avoid increasing the price it charges for each unit of gas or electricity but wholesale energy costs have risen since then, partly because of extreme weather.

“Through advanced purchases we had been able to shield our customers from some, but not all, of this impact,” Mr Lewis said.

“We’ll continue proactively to tell customers about the different tariffs on offer and encourage them to move to those tariffs, as well as promoting the different services that can potentially help bring their bills down such as a smart meter, a more efficient boiler or better insulation.”

Over 2 million customers on existing fixed tariffs and those covered by the prepayment and safeguard cap will be unaffected by the latest changes, E.On said.

Peter Earl, head of energy at Compare The Market, said E.On had not learned its lesson after previous price increases that saw customers leave the company.

“These increases in energy costs for E.On customers on Standard Variable Tariffs will most likely drive thousands of customers to switch to a cheaper deal,” he said.

“The average saving for someone on a standard variable rate currently stands at around £350 – a huge windfall for those who take the time to shop around for a better deal.”