ELECTRIC BILLS SET TO SOAR BY £68 A YEAR

THREE OUT OF FIVE HOMES FACE 14% PRICE INCREASE BY POWER NI CLAIRE McNEILLY ON THE GROWING SQUEEZE ON CONSUMER SPENDING

ELECTRICITY bills for three in five households in Northern Ireland will rise by 14% this winter, it can be revealed today.

Energy company Power NI, which supplies 58% of homes here, said the 13.8% hike from October 1 has largely been driven by the rising price of gas, which rose by 30% in the last year.

Gas generates around 40% of the electricity supply here, with renewables the other major source.

It follows a 5.6% increase in the tariff last winter and will mean an extra £68 a year lumped onto the average electricity bill.

Farms and businesses will also be subject to the rise, but because many are on personalised contracts or tracker deals, the increase may vary in when it applies.

Power NI has defended the move, stating that even with the latest hike, prices are still lower than they were five years ago and are still significantly below the main suppliers in Britain, the Republic and across Europe.

The average household paid £648 year in 2013.

Power NI said the new increase will leave the average yearly bill at £565.

Currently, the average annual bill for rival SSE Airtricity customers here is £505.

The lowest annual standard here is Electric Ireland’s £480.

Power NI managing director Stephen McCully said: “Putting our prices up is the last thing we want to do, but unfortunately we are at the mercy of fluctuating world fuel prices.

“Gas, the main fuel used to generate electricity here, has increased significantly by 30% since we last set our prices.

“We’ve worked through a rigorous process with the Utility Regulator and our customers can be sure that although unwelcome, this increase is as low as possible and our prices are still cheaper than they were five years ago.”

Power NI has said that customers can offset the hike in a number of ways. Switching to online billing and monthly direct debit payments can mean a discount of up to £60 a year.

Keypad users, who represent around 40% of all Power NI customers, can avail of discounts and get free electricity when topping up by £50 or more online.

Head of the Utility Regulator, Jenny Pyper, said that approving the price increase had been a difficult decision, but inevitable given the sharp rise in gas

“It is a fact that global energy markets are volatile,” she said.

“Looking back at the last five years there have been two Power NI tariff increases, two decreases and one year where pric- es were frozen. Whilst the Utility Regulator can provide relative stability in terms of the other regulated costs that make up a customer’s bill, fluctuations in wholesale energy costs are simply outside of our control.”

“We know that price rises are not welcome, which is why we fully scrutinise every element of the tariff to ensure it reflects t he actual cost of supplying electricity to Northern Ireland homes.

“This tariff has been set for a two year period, with the aim of providing some price stability. However, as is our usual practice, we will keep this under review.

“Should wholesale energy or other costs decrease, our system of regulation in Northern Ireland allows us to act as soon as possible to ensure that this reduction is reflected in consumer bills.”

The chief executive added: “Northern Ireland consumers have five domestic electricity suppliers to choose from and I would encourage them to shop around and explore the options available to them.”

John French from the Consumer Council said that its analysis shows the increase broadly reflects the increases seen across t he wholesale energy markets.

“However, we would wish to highlight that households can still make significant savings within the electricity market in Northern Ireland by annually shopping around for the best deal,” he said.

The Consumer Council have a price comparison tool on its website, which gives bespoke advice for each household.