Millions face second energy price rise in a year

FIVE million householders – including many of the poorest families and pensioners – are facing their second punishing energy price rise this year.

Customers with prepaid meters endured a £58-a-year increase in April and the figure will rise by another £47 a year from October – a total of £105.

The increases are the result of a decision by industry regulator Ofgem to raise the price cap which is meant to protect customers with these meters from rip-off bills.

Ofgem said raising the cap was justified because wholesale costs of gas and electricity have risen sharply this year.

There are now fears the ‘Big Six’ energy firms – British Gas, SSE, EDF, Eon, Npower and Scottish Power – will use the decision to force through a new round of price rises for millions ahead of the winter.

These companies have already increased their Standard Variable Tariffs (SVTs) at least once this year for some 11 million households and it appears new rises could be in the pipeline.

The increase of £47 will take the average bill for those with a prepaid meter for both gas and electricity up to £1,136 a year.

Ofgem said the cap meant prepaid customers would be better off than if energy firms were allowed to set their own tariffs.

Consumer experts say customers with these meters could make big savings by switching to another energy firm or tariff.

Rik Smith, an energy expert at uSwitch, said: ‘This is a stark reminder that even when there is a cap in place, prices can still rise. The only way prepayment customers can truly protect themselves is to switch to a cheaper deal or fix their tariff for additional security.’

Stephen Murray, a consumer expert at MoneySuperMarket, said: ‘If you do nothing, you are in serious danger of your bills continuing to rise. If you switch to a fixedrate tariff today with a Big Six or emerging supplier, you will see your bills decrease dramatically, by £250 or more.’