E.ON blames green rules for price hikes

ENERGY giant E.ON is on a collision course with ministers after blaming the Government for price rises.

The firm is putting up the price of electricity by 13.8 per cent and gas by 3.8 per cent.

Some 2.5million households will see a rise of 8.8 per cent in their dual fuel bill from next month – adding more than £90 a year to the cost of heat and light. Industry analysts estimate recent price rises by energy firms will add £530million a year to bills.

German- owned E.ON said the increase was down to a raft of Government tariffs to subsidise green energy such as wind farms. It also blamed social schemes, which require firms to spend millions on cheap insulation and energy-efficient boilers for the poor.

E.ON is Britain’s third largest household supplier behind British Gas and SSE with 4million residential customers. Two in three of these will see an increase in bills.

E.ON said the change ‘stems largely from an increase in costs, due mainly to the rise in non-energy parts of the bill such as social and environmental schemes, which support renewable energy and help customers use less energy’. A spokesman for Energy Secretary Greg Clark said: ‘Wherever markets are not working for consumers, this Government is prepared to act.’

Alex Neill, of consumer group Which?, said: ‘Millions of hard-pressed energy billpayers are continuing to suffer. If energy companies fail to properly engage with their customers, then the Government and the regulator must step in.’

E.ON follows German- owned Npower, French- owned EDF and Spanish- owned Scottish Power, which have already announced big increases.