Energy firms to curb price rises for customers
The Big Six energy firms have confirmed they will pass on savings made from a recently-announced package of government measures, meaning most households should see their annual bill drop by around £50.
Npower said it would reduce its planned price increases once it had further details of the government measures and also said it will then freeze prices until Spring 2015 – but only if there is no increase in wholesale energy costs or network charges.
British Gas said it would pass on savings worth an average £53 to customers.
In late November, the government said it would move the cost of subsidising those in fuel poverty into general taxation rather than require the energy companies themselves to absorb the cost. Energy firms will also no longer have to meet such strict – and costly – green targets.
Moreover, the government has agreed with electricity network companies to defer part of the cost of distribution next year.
Chris Weston, managing director of British Gas, said this would translate to an average saving of £53. “We’ve been able to do this because the government has committed to making changes to the environmental and social obligations that are paid for through energy bills. These changes will now allow us to help more people at a lower cost.”
Paul Massara, chief executive of npower, said: "We will reduce our bills. We are currently calculating how large this reduction will be, and can assure our customers that it will fully reflect the reduction in the costs to our business.”
SSE, EDF Energy, E.On and Scottish Power have also confirmed they will pass on any savings they make from tweaks in energy policy, although EDF said it had already done this when announcing its recent lower than average price rise of 3.9%.
The government is expected to release further details of its raft of energy measures in George Osborne’s Autumn Statement, presented on 5 December.
Richard Lloyd, Which? executive director, said: "It is possible to be both leaner and greener, with our analysis showing that the government could save hard pressed consumers as much as £68 off their annual energy bills, while helping the same number of people insulate their homes this year and keeping to our green commitments.
“Successive governments have failed with their energy efficiency policies, which we estimate will cost consumers £8.4 billion by 2015. A radical overhaul is long overdue so we look forward to seeing the full details from the Chancellor in his Autumn Statement this week.”