Scottish Power Domestic Energy Prices to Increase by Average of 7%

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ScottishPower has announced increases for its domestic gas and electricity prices by an average of 7% following a sustained rise in its costs since the company last reduced its gas prices in February this year.

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Other increases include an 11% rise in the cost of transporting gas and electricity to customers, and an 8% rise in wholesale energy costs.

•    Gas and electricity prices to increase by an average of 7%[1]

  •     Increases will affect approximately 2.3 million households
  •     Around 700,000 households will be unaffected as they are on a Fixed or Capped Price energy deal with ScottishPower

ScottishPower has announced increases for its domestic gas and electricity prices by an average of 7% following a sustained rise in its costs since the company last reduced its gas prices in February this year.

From 3rd December 2012 the price change will result in an average standard dual fuel bill, for a customer paying monthly by Direct Debit, increasing by £2 per week[2]. Approximately 2.3 million households will be affected. 700,000 customers will not see an increase as they are on one of the company’s fixed price or unaffected capped tariffs.

The price change will result in the following increases for an average combined gas and electricity bill[2]:

  •     A monthly Direct Debit customer will see an increase of 8.7%,with a new average annual Dual Fuel bill of £1,271
  •     Quarterly Cash or Cheque customers will see an increase of 1.4%, with a new average annual Dual Fuel bill of £1,368 (excludes Prompt Payer discounts)
  •     Prepayment customers will see an increase of 8.6%, with a new average annual bill of £1,349

For most of 2012 ScottishPower has seen a sustained increase in its costs and the company expects these to continue to rise for the rest of this year. These include a 34%[3] increase in the cost of delivering Government schemes including energy efficiency programmes. These schemes are designed to reduce greenhouse gas emissions and deliver ways to keep homes warm for less in the long-term.

Other increases include an 11%[4] rise in the cost of transporting gas and electricity to customers, and an 8%[5] rise in wholesale energy costs.

Neil Clitheroe, ScottishPower’s CEO of Retail and Generation, said: "We work hard to protect our customers and we regret that we’ve had to announce a price increase today. We reduced our gas prices in February but for most of the year we have been absorbing increased costs especially for transporting gas and electricity to our customers’ homes and the cost of delivering energy efficiency programmes.

However, we remain committed to continuing to work with the Government to help reduce the amount of energy we all use and help our customers reduce their energy bills over the longer term. To date, ScottishPower has insulated 0.8 million homes.

“All of our available tariffs are open to both new and existing customers, and ScottishPower recently topped an independent Which? survey to check if energy suppliers are actively promoting their best offers to customers^.”

“We will be writing to all those affected customers over the coming weeks explaining what the price increase will mean for them. We will also give advice on how they could reduce the impact of these increased costs. We understand that this is a difficult time for many people and we encourage our customers to contact us.”

“We will continue to try to help our customers by offering competitive fixed price products and also through the commitments we have made to help our vulnerable customers through this winter.”

ScottishPower’s existing Online Fixed Price Energy April 2014 tariff is still available to both new and existing customers.Δ

ScottishPower also announced a simplification of its pricing structure. This includes the introduction of national standing charges within our standard prices for each payment method, and changes to discounts - making them more consistent across fuels and payment types, and easier to compare with those of other suppliers.

In September ScottishPower announced a series of measures designed to help protect its most vulnerable customers during the winter months.

These included a commitment to write to all customers who pay for their energy on a quarterly basis by cash or cheque, with a personalised estimate of how much they can save by making changes to their energy account. This builds on the success of ScottishPower’s three-month tariff check campaign last winter, which resulted in just under 37,000 ScottishPower customers changing tariff, saving them more than £6.3 million off their combined annual bills.

15th October 2012

Ends

Notes

[1] Based on a weighted average of impacted ScottishPower customers who pay monthly by Direct Debit, quarterly or using a prepayment meter, averaged across Great Britain, with annual standard rate electricity usage of 3,300kWh and annual mains gas usage of 16,500kWh. Excludes prompt payer discounts.

[2] Unless otherwise stated all calculations are based on a GB average ScottishPower standard Dual Fuel customer with annual mains gas usage of 16,500kWh and annual Standard Rate electricity usage of 3,300kWh. Prices effective 3rd December 2012. All figures shown include VAT at the current applicable rate of 5%.

[3]Average percentage based on our outlook for environmental and social obligations for the year commencing April 2012 as compared to the year commencing April 2011.

[4]Average percentage based on the increased charges published by the electricity and gas network operators for the year commencing April 2012 compared to the year commencing April 2011.

[5]Average percentage based on the 12 month forward wholesale energy cost as at September 2012 compared to the 12 month forward wholesale energy cost as at January 2012.

^ Based upon Which? Energy Sales: Don’t Get Caught Out Survey Published Feb 2012 http://www.which.co.uk/energy/saving-money/guides/energy-sales-dont-get-caught-out/buying-energy-over-the-phone/

Media information: Simon McMillan 0141 614 4552/ 07753 622 257 & Paul Ferguson 0141 614 4535/ 07702 665 924

ΔOnline Fixed Price Energy April 2014 Offer key facts:

  •     Online Fixed Price Energy April 2014 Offer prices will remain fixed until 31st March 2014 but your Direct Debit and/or bill amount may vary depending on your gas and/or electricity usage.
  •     This Offer is only available to No Standing Charge customers who take both gas and electricity or electricity only, pay their bills by monthly Direct Debit, variable Direct Debit or online Debit Card; their electricity meter is either a single or two rate meter and who manage their account online.
  •     No Cancellation Charges
  •     Limited offer subject to availability and may be withdrawn at any time

Our general terms and full product Terms and Conditions apply. For details, visit http://www.scottishpower.co.uk.

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Paul Ferguson