Energy giant breaks price promise

ONE of the UK's biggest energy suppliers has reneged on an assurance it gave just two months ago that it would not impose further price rises.

Energy giant Powergen is pushing up prices for its EnergyOnline customers from 31 January by 14p a day, equivalent to some £54 a year. Electricity prices will increase by 8.9% and gas by 9.6%.

Powergen's latest hike is the same as those announced in November for ordinary residential customers. At the time the company insisted that its EnergyOnline customers would not be affected, an assurance it has now effectively torn up.

French State-owned EDF Group is also set to become even more expensive on Monday with its third price hike since March 2004. The company blamed world energy prices for an 8.1% increase in gas tariffs and a 5.4% jump in electricity prices ? even though fuel prices have fallen.

A spokesman for Powergen, whose prices soared by 17.6% last year, and will now rise again, said the company had held off making the latest increase for as long as possible. He added: 'It comes as a direct result of unparalleled rises in wholesale costs which are affecting all energy suppliers, many of which have already announced price increases. Wholesale costs have risen 39% for electricity and 49% for gas in the last six months.'

Vincent de Rivaz, chief executive of EDF Energy, said that the energy industry had talked about what it can do to help customers who were hard pressed by the constant price increases. But, he added: 'The time for talking is over ? action is required and EDF Energy has decided to take the lead on this.'

A company spokesman admitted that wholesale energy prices have come down recently but said: 'They are still high and we have been absorbing the cost in recent months. If prices continue to fall we will consider lowering our prices also.'