Scottish Power becomes latest provider to cut energy prices

Published on Friday 27 February 2009 17:04

Energy supplier Scottish Power today became the latest firm to cut gas and electricity prices.

The company, which has 5.2 million customers, is cutting average gas bills by 7.5% and electricity prices by 3% from March 31.

The move leaves only npower left among the the UK's "big six" energy suppliers yet to cut prices.

The average "dual fuel" customer taking both gas and electricity from the firm and paying by direct debit will see their annual bill fall by 54 to 1,156, Scottish Power said.

The round of price cuts was triggered by British Gas in January, when the UK's biggest supplier announced that it would cut household bills in response to easing wholesale energy costs.

But the small scale of the reductions announced so far contrasts with the swingeing price hikes landed on consumers last year amid soaring oil prices and rising wholesale costs.

Willie MacDiarmid, Scottish Power's director of energy retail, said: "The past year has seen unprecedented volatility in the wholesale energy market and the future outlook remains challenging.

"Although wholesale prices have fallen recently, the market remains volatile."

Forward wholesale costs for gas are 46% higher than in February 2007, while electricity costs are up 40% over the same period, he added.

The spotlight now falls on Npower, which is owned by German energy giant RWE, to cut prices in the UK. German households will benefit from lower bills from April after recent cuts from RWE.

British Gas made profits of 379 million last year, parent company Centrica announced yesterday.

The profit figure was 34% down on 2007's bumper haul after the firm failed to pass on all of the huge rises in the cost of wholesale gas to customers.