Consumers urged to switch power firms

ENERGY minister Chris Huhne has urged consumers to "vote with their feet" against ScottishPower's latest price hike, which will add £180 a year to the average household bill.

Mr Huhne said consumers affected by the rise - which is due to be implemented on 1 August - should hit ScottishPower "where it hurts" and shop around for energy tariffs in a bid to reduce their bills.

But experts believe that other energy providers will follow in ScottishPower's footsteps and have warned that it is only a matter of time before the other "big six" suppliers - which include Perth-based Scottish & Southern Energy - also raise their prices.

Meanwhile, John Swinney is to call an urgent meeting with ScottishPower amid fears that an extra 100,000 Scottish households would fall into fuel poverty if the other energy firms also hiked their bills. Fuel poverty is defined as needing to pay 10 per cent or more of income on fuel bills.

"Consumers don't have to take price increases lying down," said Mr Huhne. "If an energy company hits you with a price increase, you can hit them back where it hurts - by shopping around and voting with your feet.

"Right now, only one in five people switch suppliers," added Mr Huhne. "I want to see more switching, more competition and more companies in the market."

Mr Swinney said he wanted to question the energy giant - whose latest rise will add an average of 19 per cent to gas bills and increase the price of electricity by 10 per cent - over why it believes the rise is justified. He also urged energy regulator Ofgem to bring forward action to protect vulnerable customers and make the energy market more transparent.

The watchdog launched its investigation into the energy retail market in March and is due to make an announcement on submissions lodged by the energy firms later this month.

Its proposals include cutting the number of standard tariffs so customers can compare deals more easily - as well as forcing the "big six" to auction off up to 20 per cent of their power generation.

"I am deeply concerned at the scale of ScottishPower's price increases and I am seeking an urgent meeting to hear why they think increases of this scale are justified," said Mr Swinney.

"Any fuel price rises have an impact, yet these increases will leave many households, in particular vulnerable consumers, in real, real difficulty. If these increases were replicated by the other suppliers, we estimate over 900,000 households would be in fuel poverty in energy-rich Scotland.I have asked Ofgem for an urgent update on their actions to address unacceptable price rises by power companies and to further protect consumers."

A spokesman for Ofgem said: "We will make a statement on what the next steps will be later this month."

A spokesman for ScottishPower said: "We would encourage any customers who want to discuss their options to contact us. By making small changes to the way they pay for their energy or by taking one of our new or existing tariffs, many customers could still make significant savings."