Last big power firm cuts pricesCalls for competition inquiry into energy market
01 May 2007
Scottish Power caught up with rival energy suppliers after unveiling price cuts.
The company, which has 5.2 million customers, said the 16.5 per cent cuts in gas and 6.5 per cent reduction in electricity prices would bring the average dual fuel bill for direct debit customers down by £75 to £836 a year.
EDF Energy also announced a 10 per cent cut in gas bills yesterday but angered consumer groups by not lowering electricity prices, prompting calls for a Competition Commission inquiry into the energy market.
Scottish Power and EDF will introduce their lower prices on June 15. The duo are the last of the 'big six' energy suppliers to unveil reduced tariffs after British Gas began the current price war in the sector in February.
Both companies were criticised by energy regulator Ofgem last week for their failure to follow rivals British Gas, npower, Powergen and Scottish & Southern Energy by cutting prices.
Independent price watchdog energywatch called for an investigation because of a 'lack of transparency' in the market. Campaigns director Adam Scorer accused companies of 'just jockeying for position'.
Over the past year, wholesale gas prices have fallen by around 50 per cent, due to increased gas supplies through new interconnector pipelines from Holland and Norway, and helped by the mildest winter since 1914.
But Scottish Power energy retail director Willie MacDiarmid said the company had already protected customers from rises in wholesale gas prices since 2003 and added that the firm would 'continue to review' its prices.
The announcements from Scottish Power and EDF Energy come as customers of npower and Powergen also enjoy lower bills from yesterday.
An Ofgem spokesman said that the energy market was highly competitive.
He said: 'Since the beginning of this year companies have lowered prices and in the first two months of the year more than 600,000 customers switched suppliers. All the suppliers are competing against each other for business.'
Switch with Which?
Switch with Which? is the impartial and independent online service from Which?, that helps consumers compare and switch gas and electricity suppliers.
Chris Gardner from Switch with Which? said: 'There is a lot of movement in gas and electricity tariffs at the moment as most suppliers have only recently reduced their prices since the fall last year in wholesale prices. Even after price cuts, a large proportion of consumers would save more by changing tariffs or even suppliers. So while consumers cannot influence the industry directly they can take control of their own position by seeking an up to date comparison and making the switch to a better deal through online switching services such as switchwithwhich.co.uk. On average, households using switchwithwhich.co.uk saved £245 last year*, with first time switchers the most likely to make big savings - up to £500 in some cases."
* Average saving made on gas and electricity bills by UK households in 2006, using the Switch with Which? website.