In an unexpected turn of events, the big six energy supplier, British Gas announces to keep its energy prices on hold till the month of August. Experts had predicted that the company could raise its prices by a high margin to follow Npower which has announced price rise from March 16th.
British Gas explained its decision to hold the prices by saying that it is freezing the costs during the wholesale price rise by cutting its internal costs. On the other hand, another big six supplier Scottish Power has announced dual price rise by 7.8% `which would be in effect from 31 March. The company blamed its decision for increasing energy costs on expenses incurred for the smart meter installation project as well as low carbon costs.
Scottish Power has become the third Big Six Company to announce an energy price hike however, energy regulator Ofgem does not agree to the reasons given by the company and urges customers to switch to a better as well as cheaper energy provider. The Big Six suppliers that have raised prices recently are:
Scottish Power which announced a 10.8% price rise in electricity and 4.7% in gas supply leaving 1.1 million people, which is nearly one third of its customers, to bare the unwelcomed consequences.
Npower shocked the government and Ofgem by becoming the first Big Six supplier to announce a 15% hike in electricity prices and 4.8% increase in gas prices.
The best part is that around 5 million British Gas customers are relieved from the news of the price freeze however this might be for a temporary period only. The company has put all rumours of a price rise to rest by clearing that it would not raise prices for four spring and four summer months.
Apart from British Gas, there are many big and small suppliers announcing price hikes making it an environment where customer are left with no choice but to make a switch to cheaper suppliers. Suppliers blame the government policies and other expenses as the main reason for taking the decision to raise prices.
Colin McNeill, UK retail director for Scottish Power spoke on the matter by saying that “This price change follows months of cost increases that have already led to significant rises in fixed price products that now unfortunately have to be reflected in standard prices.” No matter what reason the suppliers give, energy regulator Ofgem is not ready to listen as it knows that suppliers can do without hiking the energy prices.
In a statement, energy regulator Ofgem said: “We would urge consumers to take advantage of the deals available from the many different suppliers and to shop around for a better deal if their supplier puts up their prices. This will put pressure on all suppliers to ensure they run their businesses efficiently to keep any impact on bills as low as possible.”
Shay Ramani, founder of FreePriceCompare.com expressed his views by saying that “The energy regulator and the government are completely aware about the situation faced by energy suppliers and according to them, the suppliers can do without raising prices. However, as suppliers keep on raising prices, the customers would not be left with any choice, but to switch to a cheaper supplier. We can expect millions of customers to make a switch in the near future as experts predict more price rises by prominent suppliers.”
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