Households in the UK are set to face a winter of discontent, as the combined effect of energy price rises from the ‘Bix Six’ suppliers sends energy bills soaring by an average of 8%.
Consumers in the UK could face quarterly bills that climb to as high as £530 in the coming months, according to some estimates, with the traditional increase in gas and electricity consumption during the winter set to hit households even harder.
Last month energy firm E.On announced that it would be joining leading suppliers such as British Gas, EDF and SSE in increasing its energy costs, with prices for dual fuel customers rising by 8.7% from 18 January. Electricity-only customers will also face a hike of 7.7%, while this is a higher 9.4% for gas-only customers.
Tony Cocker, E.On chief executive said: “We have held back from increasing our prices for as long as we possibly could and at the same time have worked hard to reduce our own costs as a business so that our customers can get the best price possible.”
The increases realise concerns voiced in a 2012 report from the Bank of England, which argued that higher costs for distribution, development and infrastructure maintenance faced by suppliers may lead to soaring energy bills in the first months of 2013.
Audrey Gallacher, of watchdog Consumer Focus, said: “Most industries will pass on rises in costs, but given the low levels of confidence consumers need to be reassured that retail bills, wholesale costs and company profits are in balance.
“It is a complex picture, but billpayers need to know that wholesale prices and other costs have increased enough to justify these rises. As it stands, the pressures on price are just too opaque and contested to provide confidence.”