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Energy price hike a ‘body blow for consumers’

Energy price hike a ‘body blow for consumers’

Category: Gas and electricity

Updated: 13/07/2011
First Published: 08/06/2011

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Scottish Power's announcement that it is to increase the cost of gas by 19% and the cost of electricity by 10% has been labelled a 'body blow for consumers'.

The increase will affect 2.4 million homes and is set to come into force from 1 August.

The hike has been blamed on the rising cost of wholesale prices.

The consumer watchdog Consumer Focus said the huge increase will be a body blow for consumers and it fears other energy firms could follow suit.

Companies have been softening customers up for price rises for months but customers will be shocked at the scale of this rise," said Audrey Gallacher, head of energy at Consumer Focus.

"We know suppliers like the comfort of the pack and that price rises come in waves. Every household in the country will now be bracing themselves for impact."

Scottish Power's announcement comes as the energy regulator Ofgem is deciding whether energy prices from the big six in the industry are fair.

In addition, Scottish Power is being investigated for unfair pricing and mis-selling.

All of the UK 's major energy companies increased their prices over the winter, citing rapidly increasing wholesale prices.

"Energy suppliers are in a deep, deep hole on consumer trust," added Ms Gallacher.

Scottish Power has defended the increase and says that 700,000 customers will be sheltered from the cost rises as they are on capped or fixed price tariffs.

"Wholesale prices for gas and electricity have increased significantly since the end of last year and continuing unrest in global energy markets means future prices are volatile," Raymond Jack, Scottish Power's UK retail director, said.

"We understand times are difficult for many people, and we have done what we can to absorb these additional costs for as long as possible to minimise the impact on our customers."

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