npower hikes energy price again

The energy provider npower is to increase the cost of gas and electricity for the second time this year, it confirmed today.

The energy provider npower is to increase the cost of gas and electricity for the second time this year, it confirmed today.

Some 6.3 million users across the UK will see gas prices rise by 11.8% and electricity by 7.6%, although these costs will be frozen until 2006.

The move comes just two weeks after British Gas announced price hikes for its millions of customers.

Npower said the increases were in response to a significant rise in wholesale gas and electricity costs and would come into force on October 1.

David Threlfall, chief executive of npower retail, said: "We realise that any increase is unwelcome and has implications for households trying to manage their bills, so our new rates will be frozen until 2006, allowing all our customers to budget with confidence."

Npower said an unprecedented rise in wholesale gas costs of nearly 40% over the past year had affected all suppliers. This in turn affected the cost of electricity, as 40% of the UK's electricity is produced by gas-fired power stations.

British Gas said last month that household gas bills would rise by 12.4% and electricity by 9.4% from September 20.

It blamed the increases on the record price of wholesale gas, which also impacts on the cost of producing electricity.