The announcement by Npower of increases in domestic gas and electricity prices (The Herald, January 4) is bad news for already hard-pressed consumers across Scotland. Experience has shown that other suppliers will follow suit in the coming weeks.
Prior to the Npower announcement, energywatch estimated that around 600,000 households in Scotland lived in fuel poverty - where households pay 10% or more of their income on energy. By the Scottish Government's own measure 30,000 more households will be pushed into fuel poverty for every 5% rise in prices. If the Npower rise is replicated by other suppliers we can expect to see another 90,000 households in Scotland struggling to heat their homes. In effect, nearly one household in every three will be living in fuel poverty.
In their haste to increase prices - a haste that was lacking when wholesale prices were falling and savings could be passed on to consumers - it seems suppliers have little regard for the numbers of households living in fuel poverty. The rise in the number of fuel-poor households is a direct result of rising prices.
There is, however, an opportunity for the Westminster Government to take action to lift large numbers of low-income households out of fuel poverty. The forthcoming Energy Bill should contain powers for the Secretary of State to require all suppliers to offer social tariffs to eligible low-income households. This would mean that households qualifying for a social tariff would automatically be transferred to their suppliers' lowest tariff.
Considering that the difference between a customer paying for their energy using a prepayment meter and a customer paying online can be anything up to £300, the annual saving for a household living in fuel poverty would be considerable.
Natasha Murray, National Director, energywatch Scotland.
50 West Nile Street, Glasgow.
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