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Bill hikes confirmed by npower

04/01/2008

Energy firm npower has announced, as expected, double-digit increases to its gas and electricity bills.

From tomorrow onwards customers can expect gas bills to go up 17.2 per cent and electricity bills 12.7 per cent.

Two-thirds of the UK's fourth-largest energy supplier's customers are set to see their tariffs rise, with annual bills increasing by £95 for gas and £64 for electricity customers.

According to npower, the increase is merely a reflection of a rise in the price of wholesale gas and electricity costs.

The firm's managing director of its residential business said today's decision "was not an easy one".

"We always try to protect our customers for as long as possible, but sadly higher energy prices are a fact of life," said Giuseppe Di Vita.

He added that npower was "not alone in facing these higher costs, and we expect other suppliers to follow suit very shortly".

Market watchers agree npower's competitors will follow the RWE-owned utility's lead.

"The prospect of being able to raise prices has had suppliers champing at the bit, so it was always just a matter of time before one of them made the move," said Tim Wolfenden, head of home services at price comparison website uSwitch.com.

"By announcing price increases today, npower has given the other suppliers the green flag they've been waiting for. The coast is now clear for a general price hike and energy bills can be expected to top £1,000 again - consumers are going to be in for a rough ride this year."

Adam Scorer of energy watchdog Energywatch said earlier he expected npower customers to be "despondent" and those of the other energy companies to be "looking over their shoulders to see how they respond".

"It's a pretty bleak picture in 2008," he added.

British Gas and npower had previously announced price increases on their market trackers and npower upped its online tariff for new customers by 13 per cent at the end of last month.