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Scottish & Southern set to cut energy bills

Electricity and gas bill cuts could happen in 2009

Gas hob

Gas is the most widely used heating fuel in the UK

Britain’s second biggest gas and electricity supplier gave millions of hard-pressed households an early Christmas present today when it said it planned to cut gas and electricity bills in the New Year.

Scottish & Southern Energy (SSE) said it was ‘optimistic’ that it would be able to pass on savings to customers if wholesale energy prices continued to fall.

The company, which has 8.9 million customers through the brands Southern Electric, Swalec and Scottish Hydro Electric, raised prices for electricity customers by an average of 19.2% and 29.1% for gas customers in August.

Pressure to cut bills

However, following the recent fall in wholesale prices, Britain’s gas and electricity companies have come under pressure from ministers and some consumer groups to ensure that savings are passed on to households.

Due to the way that energy suppliers buy gas and electricity through a variety of long and short-term contracts, there is a time lag between rises and falls in wholesale prices and changes in the prices charged to domestic customers.

SSE prices

SSE said: ‘If wholesale prices for electricity and gas maintain a downward trend, SSE is optimistic that it will be able to deliver reduction in prices for domestic customers during the early part of 2009.’

Which principal economist John Holmes said: ‘Which? welcomes these comments from SSE at a difficult time for consumers and, if wholesale price do continue to fall, we expect that the remaining big suppliers will follow, given their past-behaviour when it comes to raising prices.’

Find the best deal

Which?’s free and independent switching site, Switch with Which?, can help households find the best gas and electricity deals.On average, customers who used Switch with Which? saved £233 in a year, based on figures gathered from October 2007 to March 2008.

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