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Fuel bill cuts follow energy policy change | |
(35 minutes later) | |
Major energy firms have started to announce plans to pass on savings to customers following a new package of measures from the government. | |
British Gas owner Centrica said it would cut bills by £53 in January, two months after a £123 price rise for the average dual-fuel customer. | |
SSE also said it would pass on savings of around £50 and Npower plans a conditional price freeze until 2015. | |
The moves come after the government said it would make changes to bills. | |
Some subsidies for those in fuel poverty will be moved into general taxation and some green policy targets will be slowed down. It said this would cut energy bills by a total of £50 a year for the average household. | |
Homebuyers could instead be granted £1,000 to spend on energy-saving measures. | Homebuyers could instead be granted £1,000 to spend on energy-saving measures. |
New plans | |
Major suppliers have been responding to the move, which comes shortly after announcements of inflation-busting winter price rises which angered many customers. | |
Npower said it would not raise prices any more until spring 2015 unless wholesale costs went up. | |
The company introduced a planned price rise of 10.4% over the weekend, but it said that would be reduced, once it has worked out how much changes to government policy would save it. | |
SSE and British Gas said they would pass on the savings - the former by April, and the latter in January. | |
Meanwhile, EDF has indicated it would not raise prices again before 2015. In November, it announced a 3.9% rise in bills to take effect in January. This was lower than many of its rivals in anticipation of a move by the government. | |
The Energy Minister, Ed Davey, told the BBC the planned moves by the government would save households an average of £50 on fuel bills. | |
Currently, the average dual fuel bill for households is £1,340. | |
Some of the saving will come in the form of a reduction in the Energy Companies Obligation (ECO), which requires energy companies to provide insulation or other energy-saving measures to 400,000 homes a year. | Some of the saving will come in the form of a reduction in the Energy Companies Obligation (ECO), which requires energy companies to provide insulation or other energy-saving measures to 400,000 homes a year. |
In future, these measures will be paid for by a tax-funded programme of £500m, and will be granted via an average £1,000 stamp duty rebate for home buyers who need to improve energy efficiency at their new property. | In future, these measures will be paid for by a tax-funded programme of £500m, and will be granted via an average £1,000 stamp duty rebate for home buyers who need to improve energy efficiency at their new property. |