ENERGY firm ScottishPower is reportedly planning to reduce prices by 3.3% after coming under fire for failing to pass on savings from the Government's green levy shake-up.

The move will reduce typical household dual fuel bills by £40 to £1235 for ScottishPower's 2.2 million customers on variable price tariffs.

It is understood ScottishPower will also promise to pass on a further £12 rebate to all customers for the Warm Home Discount, which the Government said would be funded through general taxation instead of levies on energy bills. But the tariff cut will only partly reverse Scottish­Power's increases of 8.5% and 9% for gas and electricity respectively imposed a month ago.

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Labour last week called on ScottishPower, npower and SSE to immediately reduce prices. ScottishPower was not available for comment.