'Significant'
fuel increases on way, warns Scottish Power
Feb 9, 2006 - The Birmingham Post
One of the UK's biggest energy providers has braced households for
another "significant" rise in fuel bills.
Scottish Power, which has 5.2 million customers in the UK, warned
that the percentage increase in tariffs would be in the double digits,
although it declined to discuss the timing of any move.
Earlier this week consumer groups reacted angrily to reports that
British Gas was planning to announce a 25 per cent price hike later this
month.
Scottish Power blamed rising wholesale gas prices, which it said had
failed to offset the impact of previous retail price increases.
Chief executive Philip Bowman said: "There will be price rises and
given the current market prices they are likely to be quite significant.
"We are talking about double digits, but when it will be we have not
taken a firm view yet."
Scottish Power, which in November walked away from a pounds 10.7
billion takeover offer from Germany's E. On, increased prices in
October, when it said a 70 per cent surge in wholesale energy costs
since April had forced it to raise bills.
In third quarter results yesterday, Scottish Power said profits from
its energy retail and wholesale arm increased by pounds 11 million to
pounds 52 million in the three months to the end of December.
However, it pointed out that the improvement was due to the
efficiency of its plants and the recent rapid growth of its customer
base, adding that higher commodity prices more than offset increased
revenues from tariff rises.
Weekend speculation over future British Gas prices prompted Age
Concern to warn that higher bills could lead to more deaths of the
elderly. Gas and electricity watchdog Energywatch said if there was such
an increase, it would expect consumers to go elsewhere.
In response, a spokesman for Centrica, the parent company of British
Gas, pointed out that wholesale gas prices for 2006 were up about 75 per
cent on 2005.
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