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Last Updated: Thursday, 7 February 2008, 13:59 GMT
E.On to lift UK gas prices by 15%
Gas rings
E.On blames wholesale price rises for the increase in customers' bills
Energy provider E.On is to increase gas prices by 15% and electricity prices by 9.7%, with effect from 8 February.

The German-owned company is the latest of the big utility providers to increase prices.

It has blamed a 60% increase in wholesale prices since February last year for the rise in customers' bills.

But 670,000 vulnerable customers will have the increase delayed until 1 April, said the company formerly known as Powergen.

The energy giant is the fifth big energy provider to announce double-digit rises, after similar moves in recent weeks by British Gas, Npower, EDF and Scottish Power.

'Sustained pressure'

Graham Bartlett, managing director of E.On Energy, said: "We realise the impact this price increase will have on our customers and we're doing everything we can to minimise this.

E.On's customers didn't have long to wait for their share of the price pain.
Adam Scorer, Energywatch campaigns director

"Our announcement has been made in response to sustained pressures from the wholesale market.

"We are offering a new product to allow more customers to join the half a million already benefiting from protected prices, while also helping those customers who are most in need."

Age Concern and prepayment meter customers' prices will remain unchanged until 1 April.

Big six

The industry is dominated by the 'big six' energy providers.

Rivals British Gas - the UK's biggest power provider - increased gas and electricity prices by 15% in January.

In the same month, Npower raised its electricity prices by 12.7% and its gas prices by 17.2% and EDF Energy also put up its electricity tariffs by 7.9% and gas bills by 12.9%.

Most recently, Scottish Power increased gas bills by 15% and electricity bills by 14%.

Scottish and Southern Energy has announced it will not raise prices until April.

'Price pain'

Consumer watchdog Energywatch said the increases were "depressingly similar" to those of the other suppliers.

Men working on the logo of German power giant E.ON
German-owned E.On was formerly known as Powergen

"E.On's customers didn't have long to wait for their share of the price pain," said Energywatch director of campaigns, Adam Scorer.

"You can hardly put a pin between the suppliers' percentage rises. The actual difference between the direct debit, dual fuel prices of the suppliers who have raised prices remains at just 13.

"All the companies have quoted different percentage rises in wholesale gas costs, all the companies have different electricity generation they all have different hedging strategies, yet they come within 13 of each other on a 1,000 bill."

He welcomed a decision earlier in the week by a select committee of MPs to launch an inquiry into customer bills and the energy market.

"Government needs to be very clear about what it expects from energy companies in terms of support for their vulnerable consumers."



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