SCOTTISH consumers are bracing themselves for higher energy bills after price hikes by three of the big six energy suppliers: British Gas, EDF Energy and Scottish Power.
British Gas was the first to announce a price increase, raising the cost of gas and electricity by an average 5.5 per cent – the equivalent of £60 a year - from May 29. The price rise will affect more than four million customers on the firm’s standard variable and temporary tariffs.
The annual bill for a typical dual-fuel customer on the standard variable tariff, which was withdrawn for new customers on March 31, will go up to £1,161. Dual-fuel customers on the temporary tariff can expect an annual bill of £1,136.
The increase comes less than a year after a previous price hike, with Georgie Frost of price comparison site GoCompare Energy noting that “British Gas has bookended a very cold winter with two significant energy price rises”.
“It was only on 15 September 2017 that the firm increased dual fuel prices by 7.3%, so customers are facing their second price hike in just eight months,” she said.
EDF Energy quickly followed its rival with the announcement of a 2.7% increase in the standing charge for its standard variable electricity tariff from June 7. Scottish Power, meanwhile, yesterday announced that it would be matching British Gas's 5.5% hike.
The EDF price hike is equivalent to a £16 increase for standard variable dual-fuel customers who pay by direct debit, while the Scottish Power rise equates to an additional £63 per year.
EDF customers who pay their energy bills by cash or cheque also face an increase of £6 per fuel across the company’s standard and future fixed tariffs.
Peter Earl, head of energy at Compare the Market, said: “You’d be forgiven for thinking that the big six were addicted to hiking prices, even to the steady and significant detriment of their reputation.
“This hike – yet another in a string of them – will affect an estimated 1.3 million customers across the UK. When you bear in mind that EDF raised prices twice in 2017 by a substantial 9%, this move beggars belief.”
Experts expect other utility firms to raise prices and recommend that consumers consider switching to a better deal.
“What tends to happen when one big six energy provider increases prices, is that the rest follow in fairly quick succession,” said Ms Frost.
“This is likely to be the starting gun for a fresh round of tariff rises, meaning all big six energy customers should be on their marks and getting ready to switch.”
The argument for switching is particularly compelling if you are on a standard variable tariff, which tend to be the most expensive.
“As the energy market seems intent on squeezing every last drop out of household finances, the best way for customers to combat these relentless price hikes is to shop around for the best deal and ensure they’re not on an expensive standard variable tariff,” said Mr Earl.
“Currently, households can save over £200 on their energy bills just by switching – which can go a long way at a time when household bills continue to rise.”
The cheapest deals are usually available from smaller suppliers. For example, one of the best deals for Scottish consumers is Utility Point’s Flexi Online Tracker, which would cost the average household on a dual-fuel deal paying by direct debit £808 a year, an annual saving of £310 compared with the average of the big six standard tariffs, according to GoCompare.
If you would prefer to fix your tariff, Powershop’s Top Shopper would cost £821 a year, a saving of £297. Utility Point’s Just Up fix, meanwhile, would cost £828.
If you want to stick with one of the bigger energy firms, EDF Energy’s Easy Online tariff would cost around £905 a year. It is almost £100 a year more than the cheapest deals, but would still reap a saving of £213 compared with the average standard tariff.
That said, Kevin Pratt of MoneySuperMarket warned consumers to be aware of exit fees if they are considering switching mid-contract.
“If you are switching from a fixed tariff, you may be charged an exit fee of about £25 to £30 per fuel if you want to move to another deal before the fix expires,” he said. “It can still be worthwhile to switch, but remember to do the sums.”
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