Cuts In Fuel Bills Will Follow Energy Policy Change
By Cynthia Taylor
The Major Energy companies have begun to announce their plans to pass on savings to customers, after the government announced a new package of measures.
Centrica, owner of British Gas said that they would cut bills by £53 in January, however this is after a £123 price increase for their average duel-fuel tariff.
SSE has also said that they will pass on savings of about £50. RWE Npower said they plan on placing a conditional price freeze until the year 2015.
These moves were announced after the government said that they would make changes to bills.
The government said that some subsidies for people who are in fuel poverty will be moved into general taxation and that some of the green policy targets are to be slowed down. It is expected that this could cut energy bills by about £50 annually for the average household.
Energy bills will not increase by as much as was expected, however they will still be expensive.
These announcements follow a few months of political wrangling. And energy bills have proven to be a big tussle between the various parties, of who will sound the most credible at a time when prices are increasing faster than most people's wages.
Ed Milliband's promise to freeze energy bills for a period of 20 months should they win the next election was derided by the current coalition as a con, they say it won't work.
These measures are understandable, as this is the way the government is attempting to fight back.
Home buyers could be granted £1,000 to be able to spend on energy-saving measures.
Despite these measures, the overall prices are still increasing and for most energy consumers, these price increases by far outweigh any cuts the government makes, also these cuts will be implemented at different times not necessarily during the middle of winter.
NPower said that they won’t be raising prices until the spring of 2015 unless the wholesale costs increased.
The company had already in place a planned price increase of 10%, but said that they would be reducing this once they had worked out how much would be saved by the government's plans.
Caroline Flint has said that there is not a single measure that would cost the energy companies one single penny.
SSE will pass on the savings by April and British Gas by January.
EDF has indicated that they will not be increasing prices before 2015, they announced in November that their price increase would be 3.9%, which is to take effect in January. This is much lower than their rivals.
E.ON has not a yet announced any price increases for this winter said that the governments changes means that prices won’t be as high as expected.
Scottish Power has said that they would pass on the cuts in full, however, they added that other factors such as wholesale costs might still put pressure on energy bills.
Ed Davey, the Energy Minister told the BBC that the planned moves would save on average £50 on household energy bills.
Labour leader, Ed Miliband accused the government ministers of using 'smoke and mirrors' over their plan to freeze prices for 20 months.
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