Where will it end? Powergen's statement below. They have become the latest to announce huge increases along with British Gas, NPower, EDF
& Scottish Power. Are we being taken for a ride with no prospect of getting off?
"POWERGEN ANNOUNCES MAJOR BILL RISE
Powergen has become the latest energy provider to announce a major increase in domestic bills as a result of rising wholesale costs.
The firm, which is owned by Europe's second largest utility group, E.ON, said today that its domestic electricity bills will rise by 18.4 per cent and its gas bills by 24.4 per cent from March 10th this year.
The announcement follows British Gas owner Centrica's decision to increase domestic bills by 22 per cent from tomorrow and will add to concerns that millions of households may be unable to pay their energy bills.
Nick Horler, managing director of Powergen Retail, admitted that today's announcement would not be well received by the provider's six million UK customers, but insisted that soaring wholesale costs had left it with no choice but to raise bills.
"We know that what matters to our customers is the impact this increase will have on their pockets but we, like all energy suppliers, continue to face unprecedented pressures from wholesale costs," Mr Horler said.
"We shielded our customers from the impact of these costs for as long as possible, and we continue to ensure that our prices are highly competitive.
"I can assure all of our customers that we take our responsibilities as one of the UK’s leading energy suppliers very seriously, which is why we’ve also made extensive support available."
He added that Powergen had set aside £100 million in order to help subsidise bills for elderly and vulnerable customers.
As well as British Gas, rival suppliers EDF, Scottish Power and npower have also recently announced bill increases.
Wholesale gas prices have risen by 63 per cent since the start of the year and are 202 per cent higher than in 2003, while energy firms have also pointed out that British consumers pay less than their counterparts in Germany, France and Italy, despite the UK having the highest wholesale gas prices in Europe.
However, E.ON has seen profits soar in recent years and last week tabled a €29.1 billion (£19.9 billion) bid for Spanish power firm Endesa and today's announcement is likely to attract similar criticism to that directed against Centrica, which raised bills despite announcing record profits last week.
Old age charity Help the Aged has warned that more than 400,000 eldery people may be put at risk by rising energy bills.
"Help the Aged is very concerned about the effects that any price rise will have on older people," said the charity's head of public affairs, Mervyn Kohler.
"An extra 200,000 older people are pushed into fuel poverty when a ten per cent increase occurs, so this particular price rise will have a wide effect on vulnerable pensioners."
He added: "No older person should have to make the choice between heating and eating."