EDF Energy hikes gas bills by 19 percent

EDF Energy hikes gas bills by 19 percent

	Published : Tue, 25 Jul 2006 13:55 By : Amy Watts Print this Story

LONDON - EDF Energy has announced a 19 percent increase in gas prices and an 8 percent increase in electricity costs thus sparking off what could turn out to be a new round of energy bill increases in Britain. French-owned EDF said the rises were caused by the jump in wholesale prices of gas and oil.

This is the second time in 2006 that EDF has passed on the bills to its customers. In March the company hiked its electricity bills by 4.7 percent and its gas 14.6 percent. "We have been absorbing some of the costs of increased wholesale prices in the hope they would ease," said Derek Lickorish, chief operating officer of EDF Energy. "However, prices have remained high with little prospect for reduction in the foreseeable future. Reluctantly we now have to pass on a proportion of the resulting costs to customers." Wholesale oil and gas prices have surged by nearly 80 percent in the current year.

Mr Lickorish added that EDF was aware of the impact of rising prices on low-income groups and had introduced some measures like the prepayment deal to soften the blow. Additionally, the company said it spends £26 million a year on energy efficiency measures, most of which are aimed to take care of vulnerable customers. "Even after this rise, our prices remain competitive, and we are still the only major energy company with a special discount tariff for very low income customers," said Mr Lickorish.

Campaign groups simply shrugged off the price increases. Adam Scorer, Energywatch's director of campaigns said these price rises seemed inevitable. But he commended the measures taken by EDF to help poor customers. "With soaring price rises since 2003 putting close to 3 million in fuel poverty, we desperately need a coherent strategy to tackle fuel poverty for all consumers, not just a series of initiatives from individual companies, no matter how laudable they are," he added.

Meanwhile price comparison website SimplySwitch has forecast that the price increases would add £135 a year to a common man's energy bills. "We are already seeing escalating energy prices having one of the biggest influences on inflation, so it will hurt households in more ways than one," said Chief Executive Karen Darby. "Last year we saw unprecedented price rises and this news from EDF Energy has confirmed our prediction that this would continue throughout 2006."