You are here: Home - Household Bills - News -

E.ON criticised for setting prices close to the energy price cap

0
Written by: Emma Lunn
09/08/2019
E.ON will set the price of its standard tariff at £1,177, just £2 less than the £1,179 cap, from October.

Energy giant E.ON has priced its standard variable tariff just below the energy price cap which will fall from £1,254 to £1,179 a year from 1 October 2019.

The price change means annual bills will fall by £77 (6.1 per cent) for E.ON customers who pay by Direct Debit or £81 (6 per cent) for customers who pay by cash or cheque.

E.ON pricing its standard tariff so close to the energy price cap has prompted criticism from auto-switching service Look After My Bills.

Lily Green, head of research at Look After My Bills, said: “Surprise, surprise EON will be setting prices as high as it can, just a couple of pounds off the cap.

“It’s disappointing that with every price cap review, EON has priced as close to the cap as possible and this latest review comes as no exception. We can expect the rest of the ‘big six’ to do the same as they all see the price cap as a target rather than a ceiling.

“Even with this price cut, there are still 27 suppliers whose standard tariffs are cheaper than EON’s which begs the question – why can’t they do the same for their loyal customers?”

The energy price cap was introduced at the start of this year to give customers on pricey standard or default tariffs a better deal. It is updated every April and October to take into account the varying costs of wholesale energy.

E.ON announced earlier this week that its group operating profit had fallen by 18 per cent to €542m (£499m) in the second quarter on 2019. The firm lost 400,000 of its 4.3 million UK customers during the first half of the year.

Michael Lewis,  E.ON UK chief executive, said: “As we predicted, the overall downward trend in the wholesale markets since the start of February means customers on standard variable tariffs will benefit from a fairly significant reduction in bills from 1st October onwards. We’ll be writing to our customers in the coming weeks to make them aware of this change and how it benefits them.”

Customers paying any supplier’s standard variable tariff are likely to be overpaying for their energy. Moneysupermarket calculated that there are currently more than 100 tariffs that are cheaper than the energy price cap.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

ISAs: your back-to-basics guide for 2018/19

Here’s everything you need to know to make the most of your unused ISA allowance ahead of the 5 April deadli...

A guide to Sharia savings accounts

A number of Sharia savings products have upped their game in recent months, beating more familiar competitors ...

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week

  • RT @Defaqto: Will your home insurance leave you out in the cold? 🤔 Only a fifth of home contents insurance policies, and a quarter of home…
  • Will your home insurance leave you out in the cold? 🤔 Only a fifth of home contents insurance policies, and a quar… https://t.co/zdrVTUduNB
  • 10 reasons to get your #TaxReturn done now - and they could all mean more money for you! 💷 Questions about your ta… https://t.co/QqA42ylJEj

Read previous post:
Student spending: Deliveroo, brunch and gym memberships

Students are more likely to spend money on going out for brunch than pot noodles, while one in five undergraduates...

Close