Scottish & Southern Energy and E.ON customers to pay more for gas

Customers of Scottish & Southern Energy and E.ON are to pay more for their gas and electricity.

Scottish & Southern Energy is to increase its gas prices for residential customers by 29.2pc and power by 19.2pc from Monday.

The announcement comes four hours after rival E.ON raised gas prices 26pc and electricity by 16pc for four million customers.

Both companies blamed soaring wholesale energy prices over the past year.

German owned E.ON has around 5.5m customers in Britain but more than a quarter are not affected because they are covered by price protection schemes.

E.ON cites a 51pc rise in wholesale prices since January as the reason for the latest increase in bills. Falling oil prices have raised hopes that a further jump would provide some relief but the Norwegian pipeline setback is raising doubts.

Wholesale gas and electricity prices have risen sharply in the last two days following a leak in a Norwegian gas pipeline that could reduce supplies to Britain this winter. Unless they fall again fuel bills may rise further as a result.

Graham Bartlett, managing director of E.ON's retail business, said: "I'm very aware of the effect that today's announcement will have on our customers and I recognise that this is a very tough time for everyone.

"This was not an easy decision to take and we've tried to keep these increases as low as possible while protecting as many customers as we can."

E.ON estimates the typical customer buying both gas and electricity from the company will pay an extra 62p a day but claims they could still save £58 a year compared with British Gas tariffs.

New schemes being introduced by the company to avoid a drift of customers include capping prices until July 2010 and a free energy saving monitor to help customers track their electricity consumption.

E.ON is the third large utility in Britain to raise its household energy prices for the second time this year in response to soaring wholesale energy prices.

French supplier EDF Energy was the first to increase its prices for the second time this year when it put up its gas prices by 22pc and power by 17pc in late July.

British Gas owner Centrica raised its gas prices by 35pc and electricity by 9pc less than a week later and more big bill increases are expected before winter.

Alistair Phillips-Davies, Energy Supply Director of Scottish & Southern Energy, said: "Global demand for all types of energy has risen steeply and supplies of finite resources like oil and gas are under intense pressure,"

The increases will not apply to customers on SSE's social tariff, energyplus care, until the end of the forthcoming winter period at the earliest, the company said.

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