EDF raises gas and electricity bills

EDF raises gas and electricity bills

The other big energy companies are expected to follow suit with their own increases in the coming weeks.

EDF, which has some 5 million residential and small business accounts, said typical customers who bought both gas and electricity from the company, would see bills increase by almost £4 a week.

The company blamed the rising cost of wholesale prices for the decision to increase its prices to domestic users. It said wholesale gas prices had risen by 63% and wholesale electricity prices by 47% while coal cost 70% more than at the time the company last raised prices in January. Fossil fuel prices have been driven by the soaring price of oil.

Average household energy bills have already risen to around £1,000 a year and there had been warnings that prices might have to go up another 40% to offset the increases in wholesale prices.

Eva Eisenschimmel, chief operating officer of EDF Energy's customer branch, said: "Record world oil prices have continued to drive up wholesale prices. Alongside unprecedented rises in wholesale coal and electricity costs, this has impacted hugely on the cost of supplying energy to our customers.

"We have been absorbing some of these costs in recent months, but we now have to pass on some.....continued below

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The company, which also supplies customers through Sainsbury's Energy, said it would increase its efforts to help those most in need and that it was launching a new offer which would allow customers to fix prices until October next year."

No surprise

Florian Ritzmann, of Xelector, which provides Guardian.co.uk's energy price comparison service, said it was no surprise that EDF had put up prices.

"Suppliers have been watching each other closely for weeks, if not months," he said.

"Most suppliers will now be looking to mimic the size of this increase, in very short order, and they will be announcing these price increases while a good number of UK citizens are abroad on holiday and unable to respond."

Ritzmann said energy customers should sign up to capped rates with guaranteed rates now as the best deals may be pulled in the next few days.

Ann Robinson, director of consumer policy at price comparison website uSwitch.com, agreed other suppliers were likely to follow EDF's lead over the coming weeks.

"The days of cheap energy are over – today's move means we are another step closer to seeing the largest ever increase in household energy bills in one year – we are potentially looking at a 61% or £555 increase in total this year," she said.

If industry insiders are correct and the average energy bill hits £1,467 by the end of 2008 Robinson said spending on energy would account for 5% of the average household's net income.

"We are in danger of seeing household energy becoming unaffordable for growing swathes of society," she added.

Fuel poverty