Darling hits on energy price rises
January 17, 2008
The Chancellor of the Exchequer, Alistair Darling, has become involved in the energy price rises being enforced by energy suppliers in the UK. Over the past year energy prices have been coming down following a fall in wholesale energy prices, and this followed a period of very high charges on gas and electricity usage in the UK, pushing many households into fuel poverty.
The energy prices cuts therefore came as a relief to many, but this has been relatively short lived, with prices expected to rocket by up to 20% in some cases over the coming weeks.
Earlier this week one of the major energy suppliers in the UK, Npower, announced that its energy prices were being put up. Darling has now requested a meeting with the energy regulator Ofgem in order to discuss these price rises, the reasons behind the rises, and the implications. Gas prices have been increased by 17.2% by Npower, and electricity prices have gone up by 12.7%. Other suppliers are expected to follow suit with energy price hikes over the coming weeks.
Darling wrote a letter to officials at Ofgem, and in the letter he said: “I would be interested in receiving your assessment of gas and electricity supply and market conditions both in the UK and Europe and likely future trends. I would be particularly interested in your views on the relationship between wholesale price movements and feed-through to domestic retail prices.”
The rising cost of oil, which recently exceeded $100 per barrel, is thought to be a contributory factor in the decision of energy suppliers to hike up rates again, as is the increase in wholesale energy prices as a whole.
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