French-owned EDF Energy has drawn criticism for announcing the second hike in energy prices this year.
The first price increase came in March, when EDF raised their electricity prices by 8.4%, though this news was softened by the earlier decrease in gas prices, effective from January.
Now, they have announced a fresh round of hikes that will come into effect on June 21st. From then, electricity prices will go up by 9%, and gas by 5.5%. This will push the average customer’s dual fuel bill to £1,160 a year – £78 more than it costs at the moment. All in all, EDF’s electricity prices will have increased by almost a fifth by the end of this year, assuming no further increases come.
Importantly, these increases will only affect customers on standard variable tariffs – those with fixed rate plans will keep their same prices for the length of their fixed term.
In an attempt to justify the price increase, EDF CEO Vincent de Rivaz explained that “the industry is facing significant cost increases”.
“To be a sustainable and responsible business,” he said, “we aim to make a fair margin in supplying customers. this fair margin allows us to invest for the long term, in particular in good service, innovation and smart metering.”
Ofgem CEO Dermot Nolan criticised EDF. Ofgem issued a statement at the start of the year warning that any major supplier intending to raise their prices must be able to strongly justify their decision. Since then, Npower, E.ON, Scottish Power, SSE and EDF have all raised their prices. Among the big six, only British Gas has said that prices will be frozen for the time being – until August at least.
Responding to EDF’s latest Hike, Nolan said: “EDF’s second price rise in four months, when there has not been a dramatic rise in wholesale energy prices since it last put up prices, is difficult to justify and is further evidence that the energy market is not working in all consumers’ interests.”
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