LONDON (Reuters) - E.ON will raise prices for British customers taking both gas and electricity by 4.8 percent from Aug. 16, the German utility said on Tuesday, the last of the “big six” energy suppliers to increase its tariffs.
The move follows similar increases announced this year by the other five big suppliers in the country, and comes as regulator Ofgem is working to set a cap on standard prices by the end of the year.
The British government has asked Ofgem to put the price cap on to combat what it has called “rip off” energy prices.
Utilities have denied overcharging, but the Competition and Markets Authority found they had overcharged some British households a total of 1.4 billion pounds a year on average from 2012 to 2015, prompting the government to act.
E.ON said the increase was needed “due to the significant rise in the cost of wholesale energy, and in common with similar pressures faced by a number of other suppliers of all sizes across the industry over recent months.”
It said wholesale energy costs have increased more than 20 percent since March, largely due to the impact of extremely cold temperatures earlier this year depleting European gas storage.
E.ON said the latest rise equated to an average extra cost of 55 pounds per year per customer, and it had not increased its standard gas and electricity unit prices since April 2017.
However, earlier this year it changed the way it structured bills including scrapping discounts for people who take both gas and electricity from the company and for those who opt for paperless billing, which added around 22 pounds per year to average bills.
Britain’s big six energy suppliers, controlling around 80 percent of the market are Centrica’s British Gas, SSE, E.ON, EDF Energy, Innogy’s Npower and Iberdrola’s Scottish Power.
Reporting by Susanna Twidale; editing by Jason Neely and David Evans