Scottish & Southern Energy hikes gas, power price

Scottish & Southern Energy hikes gas, power price

	Published : Sun, 02 Apr 2006 12:05 By : Amy Watts Print this Story

LONDON: Energy supplier Scottish & Southern Energy Plc. has increased both gas and power prices for a second time in 2006 Friday.

The Perth, Scotland-based third largest utility in the country with more than six million separate customer accounts said the domestic users will face a 16.5 per cent increase in gas bills and 9.4 per cent increase in electricity bills from 1 May. The company said it was forced to increase the rates because of steep rises in wholesale price of gas.

This is the fourth time that the company is increasing its rates since the start of 2004. It had last hiked the rates on 1 January this year -- 13.6 per cent for gas and 8.9 to 12 per cent for electricity.

It said it will not now raise the rates until the start of 2007.

Alistair Phillips-Davies, the company's energy supply director, said the impact of high wholesale energy prices can only be absorbed for so long and "we have delayed this price increase for as long as possible".

The company, which operates as Southern Electric, Scottish Hydro Electric and SWALEC, said wholesale electricity prices have risen by 165 per cent and wholesale gas prices by 180 per cent since the start of 2004, whereas the average price increases it had effected are 37 per cent and 61 per cent respectively.

Apart from record increase in wholesale gas prices, the fall in supplies of North Sea oil and gas has compounded the situation.

Forward gas prices for next winter have hit a new record Friday as U.K.'s biggest storage site at Rough, owned by Centrica, remained shut since mid-February and there is no clarity on the repairs under way at the site.

All the major energy companies -- Centrica, Powergen, Scottish Power, npower and EDF Energy -- have raised their rates in recent weeks.

Energywatch, the energy sector watchdog, said with this price rise, households using the Scottish & Southern Energy will see their gas bill up by 35.6 per cent and electricity bill up by 22.5 per cent in just five months.

Energywatch said average annual bills in the country across all suppliers are now 553 pounds for gas and 354 pounds for electricity, which represents an increase of 335 pounds on average gas and electricity bills since 2003.

Scottish & Southern's shares, which reported a 25 per cent jump following announcement of half-yearly profit in November, were 1.6 per cent down at 11.30 pounds, valuing the business at around 9.4 billion pounds.