A New Round of Price Increases?

First Utility has increased energy prices for its existing customers by up to a quarter.

The start-up supplier has put up some of its prices by 23%, paving the way for the possibility of a new raft of increases from the “big six” energy companies.

Customers who are on First Utility's two variable online dual fuel tariffs - isave v1 and isave v2 - can expect increases to their energy bills.

Based on an average household, the isave v2 tariff has risen by 23.3% to £1136 a year from £921.
This deal is now £254 more expensive than the best online dual fuel deal, SaveOnline v2 from E.ON which stands at £882 a year, according to figures from moneysupermarket.com

Meanwhile, the isave v1 has also gone up from £965 a year on average to £1136 a year - an increase of 17.7%.

The news of price hikes is a stark contrast from earlier this year when First Utility named itself a price pioneer and the first energy firm in the UK to offer a dual fuel tariff costing less than £900.

Mark Daeche, chief executive officer of First Utility, said: "Last year Ofgem agreed to increase the charges that the gas and electricity distribution and transmission companies charge all Energy Suppliers. The increase in these charges came into effect on 1 April 2010.

“This is an industry-wide pricing change that all suppliers in the energy marketplace have to deal with.”
Daeche also blamed the rise in energy wholesale prices for the price hikes.
He added: “In addition wholesale energy prices have increased significantly since March 2010.
“We have been able to absorb these additional costs and delay increasing our prices until now, however it is has become apparent that these costs are likely to remain high for the foreseeable future.
“We will be reviewing this situation on a regular basis so that we can pass on price reductions directly to the consumer as soon as we can.“

At the end of July First Utility pulled two of its online deals - the smart online saver 4 and the isave V3.2 - and lauched its isave v 4 and smart online saver 5.

Is this the start of a new round of price increases from the 'big 6'? We recommend shopping around in order to obtain the best deals - particularly First Utility customers and customers coming off fixed price deals.

http://www.getmecheapbills.com lists all of the energy deals currently on offer. Check now to see how much you could save.