Energy - Fuel to cost more
WORKERS, DEC 2010 ISSUE
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Eight million British Gas customers face higher fuel bills from 10 December, when households will pay an average 7 per cent more for gas and electricity. Scottish and Southern Energy has announced a 9 per cent increase in gas prices from 1 December.
The power companies blame rising wholesale prices, environmental investment and infrastructure costs. Consumer watchdog groups reply that power suppliers always respond to forward energy prices saying that rises are therefore needed.
But wholesale prices were at one point around half of their peak in 2008 and yet in the same period customers’ prices were cut by less than 10 per cent. Now they are covering their profit margins as wholesale prices nudge up in Europe.
And yet globally there is a glut of gas. “There are no obvious reasons why energy companies should be raising retail prices this winter," Andrew Horstead, risk analyst at Utilyx, told the Daily Telegraph. "The market is well supplied, and prices have risen from the lows that we saw back in March, but they still remain well below historic levels for this time of the year.”