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| EDF increases energy prices by 3.9% | |
| (about 1 hour later) | |
| EDF has become the latest energy company to raise prices for its customers, announcing an average price rise of 3.9% on its dual fuel tariffs and warning that more increases could come if the government does not cut fees for social and environmental work. | EDF has become the latest energy company to raise prices for its customers, announcing an average price rise of 3.9% on its dual fuel tariffs and warning that more increases could come if the government does not cut fees for social and environmental work. |
| The firm said that from 3 January customers would see bills rise by £49 a year, to an average of £1,300, but it claimed it was "holding back rising costs" from government schemes to limit price rises. | The firm said that from 3 January customers would see bills rise by £49 a year, to an average of £1,300, but it claimed it was "holding back rising costs" from government schemes to limit price rises. |
| The increase, which will also apply to customers taking just gas or electricity from EDF, is less than half those announced by rival firms including British Gas and Scottish Power, but is unlikely to be welcomed by the two-thirds of EDF's 5.8 million business and residential customers not on fixed tariffs. | The increase, which will also apply to customers taking just gas or electricity from EDF, is less than half those announced by rival firms including British Gas and Scottish Power, but is unlikely to be welcomed by the two-thirds of EDF's 5.8 million business and residential customers not on fixed tariffs. |
| EDF said it had taken action ahead of the outcome of the government's review of the costs of the Eco scheme to help vulnerable households and other green schemes, designed to bring down costs for consumers. | EDF said it had taken action ahead of the outcome of the government's review of the costs of the Eco scheme to help vulnerable households and other green schemes, designed to bring down costs for consumers. |
| It said if the government made bigger changes to the costs of its social and environmental schemes than it had anticipated, it would pass those savings on to customers, but if the changes were smaller there could be further price rises. | It said if the government made bigger changes to the costs of its social and environmental schemes than it had anticipated, it would pass those savings on to customers, but if the changes were smaller there could be further price rises. |
| The firm said the extra £49 on bills was made up of the following: | The firm said the extra £49 on bills was made up of the following: |
| • £24 to meet a 9% rise in transmission and distribution costs | • £24 to meet a 9% rise in transmission and distribution costs |
| • £10 to meet smart-metering costs | • £10 to meet smart-metering costs |
| • £6 to meet a 22% rise in the cost of meeting renewable obligations | • £6 to meet a 22% rise in the cost of meeting renewable obligations |
| • £1 to meet rising wholesale costs | • £1 to meet rising wholesale costs |
| • £8 to meet other rising costs including VAT, warm home discount, feed-in tariff | • £8 to meet other rising costs including VAT, warm home discount, feed-in tariff |
| The price rise includes the removal of a 70p-a-month discount for dual fuel customers. It will be largest for customers in the south-east of England who will see bills rise by 4.3%, while in the south of Scotland bills will rise by just 2.78%. | The price rise includes the removal of a 70p-a-month discount for dual fuel customers. It will be largest for customers in the south-east of England who will see bills rise by 4.3%, while in the south of Scotland bills will rise by just 2.78%. |
| The chief executive of EDF Energy, Vincent de Rivaz, said: "The best way to help customers is for us to keep our prices as low as possible. I know that price rises are always unwelcome, but we have taken the first step to show what can be done if rising costs are tackled head-on." | The chief executive of EDF Energy, Vincent de Rivaz, said: "The best way to help customers is for us to keep our prices as low as possible. I know that price rises are always unwelcome, but we have taken the first step to show what can be done if rising costs are tackled head-on." |
| De Rivaz said he supported social and environmental programmes, but that their cost and affordability had to be challenged. | De Rivaz said he supported social and environmental programmes, but that their cost and affordability had to be challenged. |
| "Energy firms, politicians and consumer groups need to be part of the solution and stand on the side of customers to give them energy at an affordable price. That means operating as efficiently as possible and designing the most cost-effective social and environmental programmes," he said. | "Energy firms, politicians and consumer groups need to be part of the solution and stand on the side of customers to give them energy at an affordable price. That means operating as efficiently as possible and designing the most cost-effective social and environmental programmes," he said. |
| Reg Platt, senior research fellow at the thinktank IPPR said described the price rise as "simply astonishing". | Reg Platt, senior research fellow at the thinktank IPPR said described the price rise as "simply astonishing". |
| He said: "They have in effect issued a threat to government saying 'cut back your policies or we'll raise our prices further'. The policy they want to cut, Eco, provides households with insulation and efficient boilers to protect them against rising energy bills. | He said: "They have in effect issued a threat to government saying 'cut back your policies or we'll raise our prices further'. The policy they want to cut, Eco, provides households with insulation and efficient boilers to protect them against rising energy bills. |
| "David Cameron has said he wants to roll back so-called 'green levies'. If this means the government is going to roll over to the energy companies and cut spending on energy efficiency policy it will be billpayers that get hurt." | "David Cameron has said he wants to roll back so-called 'green levies'. If this means the government is going to roll over to the energy companies and cut spending on energy efficiency policy it will be billpayers that get hurt." |
| The secretary of state for energy and climate, Ed Davey, has warned energy firms that they face a "Fred the Shred" moment because consumers' trust in them has broken down as it did with the banks. | The secretary of state for energy and climate, Ed Davey, has warned energy firms that they face a "Fred the Shred" moment because consumers' trust in them has broken down as it did with the banks. |
| Commenting on EDF's price increase, he said: "Any price rise is disappointing but I'm encouraged that EDF have kept their price rise much closer to inflation than some of their competitors. | Commenting on EDF's price increase, he said: "Any price rise is disappointing but I'm encouraged that EDF have kept their price rise much closer to inflation than some of their competitors. |
| "The competition we've introduced to the energy market means people have a choice. They can look for the best deal available; including from smaller suppliers, with the confidence that switching will make an immediate difference to their bills and force the Big Six to compete on price." | "The competition we've introduced to the energy market means people have a choice. They can look for the best deal available; including from smaller suppliers, with the confidence that switching will make an immediate difference to their bills and force the Big Six to compete on price." |
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