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Energy price cuts for Power NI but SSE rises

The BBC reports Power NI has declared a 14% cut in electricity prices. Meanwhile the SSE announces 9% energy price rise.

Power NI has announced a 14% cut in electricity prices for Northern Ireland customers, the BBC reported today.

The reduction becomes effective in October 2012.

The company said the price cut would shave £80 a year off a typical household’s electricity bill. It follows a rise of 18.5% last year.

Power NI managing director Stephen McCully, said prices should remain the same for 12 months.

He said the driver around the reduction this year was gas and coal prices.

The price reduction covers both domestic and small business customers.

Unless there are very wild fluctuations in world fuel prices we would be hopeful that we could hold these prices for a year”

The price reduction means Power NI will be cheaper than the UK average from October. However, other companies are likely to have an autumn price review so their prices could be reduced as well.

However SSE has announced rises in both gas and electricity prices from 15 October.

The price rise, affecting 5 million electricity customers and 3.4 million gas customers, means SSE’s average standard dual-fuel bill will increase by more than £100 a year from £1,172 to £1,274.

The supplier had previously promised not to increase proces before October,so is in effect increasing household energy billsat the first possible opportunity. It blamed “sustained increases” in the cost of using the electricity and gas networks, as well as the price it has paid for energy in the wholesale markets.

When the higher prices kick in customers will also be moved to a standing charge and single unit rate, meaning millions will have to pay the standing charge of £100 a year for each type of fuel they use, equating to around 55p a day for dual fuel users. Customers paying by direct debit will get a £40 discount.

The firm said it will cap gas and electricity prices until at least the second half of 2013.

In 2011, all the big six energy suppliers increased their prices, in some cases more than once. SSE increased its prices in December 2010 and September 2011 by 21.9% or £227 in total. It cut them in March this year by 2.4% or £30.

Although E.ON has said it will not increase bills for customers before the end of 2012, fears are growing that SSE’s action will pave the way for other suppliers to increase their prices.