Customers urged to ‘shop around’ after energy giant raises prices for 1m users
CUSTOMERS have been advised to “shop around” for a better deal after Scottishpower became the latest energy company to raise its prices.
The firm announced yesterday that the cost of its variable tariff for gas and electricity will go up by about £46 a year from October.
It is the second time this year the Big Six energy company, which is owned by Spanish multinational Iberdrola, has increased prices, and follows a £64 rise in June.
About one million of its customers will be affected, with the company blaming “continued increases in wholesale energy costs”.
Neil Clitheroe, chief executive of Scottishpower’s retail division, said: “We have seen significant increases in wholesale energy costs since April, and, like others in the industry, this means we need to increase our prices.
“More than two-thirds of our customers are on fixed-price products or other tariffs not impacted by this price change.
“Those customers affected by the price change will be contacted and offered the opportunity to move to a fixed-price tariff alternative and avoid this increase.”
The latest rise comes weeks after British Gas said it is raising its standard variable tariff by 3.8 per cent.
Energy regulator Ofgem has also recently increased its price cap on variable tariffs due to rising wholesale prices.
Its safeguard tariff, which protects five million households from overcharging, will go up by £47 per year in October to £1,136.
The watchdog said it was increasing the cap due to rising oil prices, which have fed through to wholesale gas prices.
Several energy companies have ramped up prices over the summer, affecting millions of households.
E.ON, SSE, Npower, EDF and Bulb have all increased bills, blaming wholesale energy costs for the increases.
Consumer groups have warned energy customers about the rising tariffs, saying they should switch to a better deal.
Victoria Arrington, a spokeswoman for energyhelpline, said: “Consumers can hardly keep up with the tsunami of price hikes this year. This second Scottishpower price rise is yet another bitter pill to swallow for millions of households.”
Georgie Frost, consumer advocate at Gocompare Energy, said customers should be wary of moving to a fixed rate tariff to escape the price rise, as there were cheaper options out there.
She said: “Scottishpower has no fixed dual fuel tariffs that feature in the top 50 cheapest that are currently available. So if you’re moved from their SVT to a fixed deal, you still have at least 50 other options that could be better for you.
“When this increase comes into force, Scottishpower’s dual fuel SVT rate will be £1,211 for a medium user paying by direct debit. That’s £404 more expensive than the current cheapest deal. So if you’re a Scottishpower customer you’re sure to find something that provides better value by shopping around.”