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npower raises gas and electricity prices – the fifth of ‘big six’ firms to do so

German-owned company increases gas prices by 15.7% and electricity prices by 7.2%, adding £134 a year to the average bill

Millions of Britons face substantially higher energy bills after npower became the fifth of the “big six” providers to raise gas and electricity prices in the past two months, blaming the “volatile global wholesale market” for the increase.

The company, owned by Germany’s RWE, said it will increase average gas prices by 15.7% and electricity by 7.2% from 1 October, adding 37p a day or £134 a year to the average bill. This will give npower’s 6.5 million British customers an average energy bill of £1,188 a year.

Kevin Miles, chief commercial officer at RWE npower, said: “I know it hurts everyone when we put up prices and I wish we didn’t have to. With reduced quantities of North Sea gas, we are now forced to buy energy on the volatile global wholesale market. World events have pushed up prices and we believe this trend will continue.”

The company follows Scottish Power, British Gas, Scottish & Southern Energy and E.ON in announcing price hikes, blaming wholesale price rises and pointing to the nuclear crisis in Japan, the Arab spring uprisings and the nuclear shutdown in Germany as the reason. EDF is the only one of the big six – which between them provide 99% of the energy used in UK households – not to have raised its prices.

Miles pointed out that npower’s price increases were significantly below the tariff increases of between 10% and 19% on gas and electricity introduced by its rivals .

Although wholesale energy prices have risen significantly this year, they are still down about a third from their peak in 2008, while average domestic energy bills have risen to record levels.

Miles said: “Although our half year profits were better than last year, they do not begin to match the billions of pounds we are investing in energy for the future.” © Guardian News & Media Limited 2011 | Use of this content is subject to our Terms & Conditions | More Feeds