E.ON hikes bills for the second time in months
E.ON has announced it will increase bills for nearly two million customers this summer, blaming the ‘Beast from the East’ and higher wholesale energy costs for the move.
From 16 August, 1.8 million E.ON customers on its standard variable electricity and gas tariffs will see bills rise by an average of 4.8%.
This will add an average of £55 to dual fuel bills, meaning customers will pay on average £1,208.
For those on electricity-only standard tariffs, the move will add 6.2% or £36 to annual bills. Standard gas only customers will see an average 3.3% or £19 added to bills.
Customers on fixed energy tariffs or with prepayment meters are unaffected by the price hike.
E.ON said due to the “significant rise in the cost of wholesale energy” and the extreme weather conditions, i.e. the ‘Beast from the East’ it was forced to raise prices.
But the move comes just months after E.ON announced standard variable tariffs would rise by an average of £22 a year in a bid to ‘simplify bills’.
Following a tariff review, E.ON removed the £20 a year dual fuel discount in March, as well as the £5 per fuel per year paperless billing discount. It also increased the standard charge for customers who pay quarterly by cash or cheque, adding £10 per fuel per year.
Now, E.ON has increased the unit price offered having previously leaving this untouched.
Michael Lewis, chief executive of E.ON UK, said: “We had hoped that by making the structural changes we made earlier this year, impacting bills by around £22 a year, we could avoid an increase in our unit price. Those changes applied to all tariffs, not just our standard variable tariff, and reflected cost changes as we saw them at the time as well as bringing our tariff structure in line with most of the market.
“However as was seen in relation to the increases in the regulated prepayment cap in April, a number of costs have risen quite sharply and in particular we’ve experienced a hike in the price we have to pay for the energy our customers need, partly driven by the Beast from the East and extreme weather conditions experienced earlier this year. Through advanced purchases we had been able to shield our customers from some, but not all, of this impact.”
Lewis added this is the second unit price increase it’s made in over four and a half years during which time it has cut prices on two occasions. Since March 2018, wholesale energy costs have increased 22%.
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