Scottish Power to reduce household gas prices by 4.8%

The energy supplier is the third of the Big Six to make an announcement

The move comes in the wake of a fall in wholesale costs (PA)

Scottish Power has today become the third UK energy supplier to announce household gas price cuts.

The Spanish-owned company said it will cut prices by 4.8 per cent from 20 February, reducing customers' average annual gas bills by £33.

The move comes in the wake of a fall in wholesale costs and places further pressure on the remaining three Big Six rivals to follow suit.

Neil Clitheroe, Scottish Power's chief e utive of retail and generation, said: "We are pleased to be able to pass on this price reduction to our customers."

Yesterday British Gas announced it will cut household gas prices by five per cent next month.

The energy supplier, owned by Centrica, said the move will benefit 6.8 million customers and will reduce the average annual bill by £37.

And last week German-owned E.On cut its standard gas price by an average of 3.5 per cent with immediate effect.

Its 4.5 million customers are set to save an average of £24 on their annual bill.

The gas price cuts have thrown the energy sector back into the spotlight four months ahead of the general election in which Labour will pledge to cap tariffs.

Prime Minister David Cameron said in response to yesterday's British Gas cut that it would not have been possible under a price freeze by Labour.

The reductions have fallen short of industry estimates suggesting bills could fall by £136 a year if suppliers were to pass on in full the drop in wholesale prices.

Industry experts believe the firms may be reluctant to make deeper cuts for fear they will be locked into them should Labour win the election and cap prices.

Scottish Power's announcement comes two weeks after Chancellor George Osborne launched an investigation into whether key sectors such as energy firms were passing on the costs of falling wholesale prices to consumers.

Labour proposed giving Ofgem new powers to force suppliers to do so.

The sector is also in the midst of an in-depth investigation by the Competition and Markets Authority which could result in bigger players such as British Gas being broken up.

Additional reporting by agencies