npower to increase standard dual fuel prices by 12.2%*
16 Aug 2011 
National / Pricing
- Lowest increase announced by any major supplier (1)
- New fixed price deal to cover next two winters(2)
npower today announced changes to its domestic standard retail prices.
From Saturday 1 October the average standard monthly direct debit dual fuel customer, will see an increase of 37p(3) per day. The new rates are on average £30 per year cheaper than British Gas, (4) and cheaper than any other supplier who has increased prices on the same basis.(5)
For single fuel customers, the average increase is 15.7% for gas(6) and 7.2% for electricity(7).
Kevin Miles, chief commercial officer, at RWE npower said:
“I know it hurts everyone when we put up prices and I wish we didn’t have to. Although our half year profits were better than last year they do not begin to match the £billions we are investing in energy for the future.
“With reduced quantities of North Sea gas, we are now forced to buy energy on the volatile global wholesale market. World events have pushed up prices and we believe this trend will continue. In the UK we have also seen rising distribution and network charges, and further environmental costs but we have still managed to keep our increases lower than those announced by any other major supplier”
Price Increase comparisons
(Based on Ofgem standard consumption of 16,500kWh gas and 3,300kWh electricity, averaged across payment methods)
Supplier | Gas | Electricity | Dual Fuel |
Scottish Power | 19% | 10% | 15.6% |
British Gas | 18% | 16% | 17.7% |
SSE | 18% | 11% | 15.3% |
Eon | 18.1% | 11.4% | 15.2% |
npower | 15.7% | 7.2% | 12.2% |
EdF | ? | ? | ? |
Winter Fix(2)
npower is also introducing a new deal which fixes the new rates until March 2013, protecting customers who sign up for the next two winters. Both new and existing customers will also get a one off bonus of £20 per fuel (£40 for dual fuel) credited to the first bill.
Energy Efficiency
Since April 2008 npower has completed nearly 1 million energy saving projects (such as loft and cavity wall insulation). In fact in that time, we have laid enough loft insulation to go twice round the coast of Britain.
Customers looking to cut their energy use can call npower’s energy efficiency experts on 0800 02 22 20 or visit www.npower.com. Free insulation for the over 70’s or anybody receiving certain benefits, is still available from npower. Call 0800 975 6617.
Special Tariffs
npower will contact customers on the Spreading Warmth Tariff and offer free loft and cavity wall insulation (worth about £300 on average) until the end of November.
From today npower will provide £120 annual discount for vulnerable customers who are accepted under the Government’s new Warm Home Discount scheme. Customers can find out more information by calling 0800 980 5525 or visit npower.com for further details. Any customer who is having difficulty with their energy bill should call us.
Sales
Over the last few years we have invested much effort into recognising our customers' preferences regarding sales. These preferences are evolving and we have been reviewing our approach to cold selling on the door step through our direct labour force. After consultation with our staff we will determine which sales channels will continue.
It is therefore clear that there will be a transition from cold sales on the door step.
£100 annual Direct Debit discount (£105 including VAT).
(ENDS)
For further information please contact the npower press office on 0845 070 2807
Notes to Editors:
Notes to editors:
* Changes to Standard Dual Fuel Prices:
Based on Ofgem standard annual consumption of 16,500kWh gas and 3,300kWh electricity. Prices averaged across Britain and include VAT.
Payment Method | Old Dual Fuel Bill | New Dual Fuel Bill | % Difference | £/p.a. | per week | per day |
Monthly Direct Debit | £1,054 | £1,188 | 12.7% | £134 | £2.57 | £0.37 |
Receipt of Bill | £1,149 | £1,282 | 11.6% | £134 | £2.57 | £0.37 |
Pay As You Go | £1,145 | £1,288 | 12.4% | £142 | £2.74 | £0.39 |
Average | £1,116 | £1,253 | 12.2% | £136 | £2.62 | £0.37 |
(1) Lowest increase announced by a major supplier based on Ofgem standard annual consumption of 16,500kWh gas and 3,300kWh electricity
| Gas | Electricity |
Scottish Power | 19% | 10% |
British Gas | 18% | 16% |
SSE | 18% | 11% |
Eon | 18.1% | 11.4% |
npower | 15.7% | 7.2% |
NB Timing of increases
If npower had adopted the same approach as Scottish Power and increased the average dual fuel cost by 48p a day from 1 August. npower customers would have paid an additional £15 before 1 October (Company equivalent - £30 million)
(2) Winter Fix
Will be available to new and existing customers who pay by monthly direct debit or receipt of bill. Prices are fixed at new standard rates to 31 March 2013. There is a £20 per fuel early exit fee. Terms and conditions are available online at www.npower.com/winterfix
(3) Average increase per day
Prices based on average annual consumption of 16,500 kWh gas and 3,300 kWh electricity payment via monthly direct debit. Previous national average price £1,054, NEW national average price £1188. £134/366 = 37p inclusive of VAT
(4) npower standard MDD DF v British Gas standard MDD DF
Average national price based on Ofgem average consumption 16,500kWh gas and 3,300kWh electricity – npower £1,188 / British Gas £1,219
(5) Cheaper on average than any other major supplier which has increased prices this summer
based on standard monthly direct debit dual fuel at Ofgem standard average consumption of 16,500 kWh gas and 3,300 kWh electricity. Prices averaged across Britain.
British Gas £1,219 | Scottish Power £1,206 |
Eon £1,190 | SSE £1,189 |
(6) Increase in gas prices
Based on annual average consumption of 16,500 kWh of gas averaged across payment types (MDD / ROB / PAYG)
(7) Increase in electricity prices
Based on annual average consumption of 3,300 kWh of electricity averaged across payment types (MDD / ROB / PAYG)
(8) Energy Costs
Wholesale energy prices have been impacted by events such as the tsunami and Fukushima in Japan, political changes in the Middle East, nuclear shut down in Germany. Increasing consumption of energy in developing economies will also push prices higher.
The cost of using the networks to deliver energy to people’s homes, determined by Ofgem, has increased over the last twelve months.
Finally the costs of mandatory and social obligation schemes such as CERT and the Warm Home Discount are higher than they were 12 months ago.
Recent media coverage has reported that wholesale energy prices on the ‘Spot Market’ have fallen - this is correct. However, energy suppliers buy in advance, in some cases up to three years; they do not buy all their energy a day or a month ahead from when they require it. Therefore changes on the short term ‘spot market’ have very little impact. npower has already bought a significant proportion of its needs for customers to cover the coming winter period.
(9) Revenues
This is the second year that specially prepared accounts for RWE npower and the other major energy suppliers in the UK have been made available to a specification set by Ofgem. These are available online.
RWE npower’s retail business made a profit of £14m on more than £6 billion revenue in 2010, a significant improvement on 2009 due in no small part to our sustained and company wide focus on cost reduction and efficiency gains.
Our generation business also benefited from this focus on operational efficiency. Our programme of investments – including our new £650m gas-fired power station at Staythorpe – has helped to counter the significantly reduced margins from our legacy coal and oil-fired stations. All but one of these are due to close in the next few years.
(10) All prices are inclusive of VAT
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