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From 31st August the company will raise electricity prices by 7.2% and gas prices by 11.9% for the majority of residential customers.

Nick Horler, Managing Director of Powergen retail said: “The UK is in an era of rising energy prices and we, like all energy suppliers, are under tremendous pressure as the prices we pay for electricity and gas reach an all time high.”

Wholesale costs of electricity have risen by around 24% for medium energy users, while gas is up 35%. The costs are affecting all companies and Powergen’s is the first of many expected announcements.

“By making a smaller increase in the summer rather than a larger increase later in the year, we can help our customers ahead of the winter when they use energy most,” Mr Horler added.

Environmental Economists Trucost have attributed 12% of the 24% wholesale electricity price rise to the EU emissions trading scheme as prices for trading allowances and volume of trading has increased sharply in recent weeks.

This rise in trading has been attributed to rising gas prices leading to a greater use of coal which produces more carbon dioxide and, therefore, requires more emissions allowances to offset this.

British Gas has said it is likely to raise prices by around 15% – its third increase this year.

Powergen has sought to minimise the impact of rising energy bills by offering all customers discounted cavity wall insulation and four free low-energy light bulbs.

By David Hopkins

© Faversham House Ltd 2022 edie news articles may be copied or forwarded for individual use only. No other reproduction or distribution is permitted without prior written consent.

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