Scottish Power follows energy herd with 8.6% hike

Another one bites the dust! Scottish Power is the fourth of the Big Six energy providers to raise its standard tariff charges in the past two weeks.

tbc
The firm is hiking prices by an average of 8.6%, pushing a typical annual dual fuel bill up by £113 to £1,385 for those paying by direct debit and £1,480 for those paying quarterly by cash or cheque.

Electricity prices will typically rise by 9% and gas by 8.5 %. The increases will take effect from December 6th.

Earlier this week npower raised its prices by an average of 10.4%, while British Gas pushed through a 9.2% increase last week. SSE started the seasonal round of price rises on October 10th with an 8.2% increase.

On Tuesday, Scottish Power agreed to fund £8.5 million of customer redress after admitting to misleading sales practices.

Who’s next?

The two remaining major providers, EDF and e.on, are widely expected to increase prices in the coming days.

Clare Francis, editor in chief at MoneySuperMarket, said: “Scottish Power is just the latest energy supplier to add to bill payers’ woes by announcing an 8.6% per cent rise to prices. It means that, from early December, with Christmas fast approaching, 2.2 million customers will see a £113 hike in their bills.

“Over the last two weeks 20.5 million households have been hit with bill increases from four of the major energy companies and it’s only a matter of time before EDF Energy and e.on announce further increases. But the message to switch and fix seems to be hitting home. Last Thursday MoneySuperMarket witnessed a huge increase of 1,556% in customers applying for new tariffs through after British Gas made its announcement.”

Consumer power

Francis added: “This is a clear sign that bill payers are starting to take power into their own hands to bring down the cost of their energy. 

“This is great to see as the vast majority of households have never switched energy provider and as a result are paying over the odds for their gas and electricity. We’ve still got a long way to go before switching becomes habitual but it appears as though this latest round of price hikes could prove to be the tipping point needed to change behaviour and prompt people to act.

“Average annual bills will be nearly £1,500 a year once the new prices take effect, which is a huge cost for households, many of whom are already financially stretched. Switching to a cheaper energy deal is easy and it could save you hundreds of pounds a year.

Substantial savings

“Bill payers can save on average £171 by switching to the cheapest fixed tariff. iSave Fixed v11 from First Utility guarantees to fix your price until May 2015 and, with an average bill of £1,171.97, it is £315 cheaper than the average standard tariff from Scottish Power.

“Longer-term fixes are also available from EDF Energy, npower and even Scottish Power, all promising to fix prices until 2017 with average bills now beating standard offerings from British Gas, SSE and Scottish Power.

“It takes just five minutes to compare and switch energy tariffs and the energy company will take care of the rest. You can also do more around the home to keep your energy price down, introducing simple changes such as turning appliances off instead of leaving them on standby or doing your washing at 30 degrees. Making sure that your home is well insulated will also help to reduce your bills.”

Switch, fix and save

Energy providers have come in for severe criticism from all quarters for the size of their price increases, which are typically three times the rate of inflation, or even more. Earlier this week, former Conservative prime minister Sir John Major weighed into the debate with a call for energy firms to pay a windfall tax on their profits to help fund distress payments if we suffer a harsh winter.

He expressed sympathy for the views expressed by the Archbishop of Canterbury, Justin Welby, who said at the weekend that energy firms should not pursue excessive profits at the expense of consumers.

Energy was also the main topic at prime minister’s questions in Parliament on Wednesday when David Cameron suggested the government might reduce the green levies that are built into energy bills as a way to ease the burden on consumers.

Cost-cutting tactics

MoneySuperMarket urges customers on their provider’s standard tariff to check to see if they could save money and insulate themselves from further increases by switching to a fixed deal. Prices might be lower than you are paying at the moment, and you will certainly shelter yourself from any further price increases during the length of the fix.

You can switch in minutes via our energy hub  and all the information you need is contained on your latest bill. If you prefer not to switch online, you can talk to one of our energy experts, who will guide you through the process, on 0800 177 7861.

Energy discounts

If you're struggling to pay your energy bills, contact your supplier to see if you qualify for help. For example, the Warm Home Discount Scheme is a government-backed initiative that gives the elderly and those on low incomes a £135 discount on their electricity bill.

On top of this, those aged 61 and over qualify for the Winter Fuel Payment of £200 per head, rising to £300 per head for those aged over 80. And a £25 Cold Weather Payment will be made to pensioners each time the temperature fails to break 0 degrees Celsius for a period of seven consecutive days.

You can save money by making your home more energy efficient, cutting what you use and taking steps to keep warmth in through insulation and other measures. Here are some suggestions about how to do this.

Please note: Any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct

* Up to 10% can save at least £244.64, MoneySupermarket data based on sales. June 2013

Did you enjoy that? Why not share this article

SAVE MONEY NOW

Other articles you might like

Popular guides