E.ON raises energy bills 9pc



Four million households will feel an extra pinch on their finances from today when their energy tariffs are increased.

E.ON is the last of the big six energy giants to increase its tariffs this winter, meaning that its typical standard dual fuel customer paying by cash or cheque will see their bill rise by around £110 a year to £1,370.

The latest price rise comes at a time when households up and down the country are turning up the thermostat, with forecasters saying Britain will be coated in up to 10 inches (25cm) of snow tomorrow.

Comparison website Confused.com said that the recent increases have widened the gap between the cheapest tariffs on the market and the standard deals being offered by the big six companies to more than £300 a year.

Two years ago, customers on standard dual fuel tariffs were paying up to 23pc or £221 a year more than those on the cheapest deals, but the latest round of hikes has increased the price gap to almost a third (30pc) or £312, the website said.

The energy price gap was calculated by working out the cost for an average dual fuel user if they were on the cheapest tariff on the market and paying by monthly direct debit.

Researchers looked at the difference between this and what someone on a typical standard dual fuel tariff from one of the big six energy companies would pay, if they were covering their bills quarterly by cash or cheque.

E.ON's announcement last month that it planned to put up its prices followed a string of similar confirmations from SSE (LSE: SSE.L - news) , British Gas, npower, Scottish Power and EDF (Paris: FR0010242511 - news) .

Having pledged in May to keep residential energy prices on hold during 2012 , E.ON blamed the new year hikes on increased costs that make up energy bills, including the price of energy on the wholesale market and regulatory costs.

E.ON's average dual fuel bill will increase by 8.7pc, with electricity rising 7.7pc and gas by 9.4pc.

According to research by MoneySupermarket.com, households typically use around 40pc of their annual energy consumption during the winter months, making the next average quarterly standard bill likely to be well over £500.

Soaring energy prices have been a major driver of inflation which has squeezed households in recent months.

The Fuel Poverty Advisory Group (FPAG) recently estimated that 300,000 more homes were pushed into fuel poverty over Christmas, meaning these families are spending more than 10pc of their incomes on keeping their homes warm.

Age UK said that elderly people in rural areas were struggling to keep warm because of the rising cost of heating oil. Last month heating oil prices were 14pc higher year-on-year.

The charity said as many as 1.5 million older people were living in rural areas not connected to the gas grid and were the "forgotten face" of fuel poverty.

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