Npower to increase energy prices by 9.8 per cent from mid-March

Npower cited increases in wholesale energy costs and the cost of delivering on government policies for the move

Some energy suppliers in Britain announced freezes to standard winter prices late last year

British energy supplier Npower will raise its dual-fuel annual energy bills by an average of 9.8 per cent, or £109, from 16 March, it said on Friday.

The Innogy-owned firm said the increase is equivalent to an average rise of 4.8 per cent for gas and 15 per cent for electricity, adding that it is its first increase since October 2013 and will affect about half of its 2.8 million customers.

“This is a hugely difficult decision, and we’ve delayed the date this takes effect until after the coldest months of the year. We’ve also made sure that our most vulnerable customers won’t see any impact until May,” Simon Stacey, the company’s managing director for domestic markets, said in a statement.

Npower said increases in the price of wholesale energy and the cost of delivering on government policies were behind the move.

“This trend is set to continue, with network and policy costs representing an increasing share of domestic electricity bills,” it said.

British wholesale gas and electricity prices rose sharply last year and have continued to rise this year, leading to speculation that electricity suppliers could raise prices after the end of the peak winter heating season.

Late last year energy suppliers in Britain, such as Centrica, E.ON, SSE and EDF, announced freezes to standard winter prices.

E.ON said that its residential standard energy prices would not increase until at least April this year, while EDF said its variable electricity prices would be frozen until 1 March but then rise by 8.4 per cent.

Reuters