Big six energy provider makes changes to its tariff designed to increase prices to customers
Big six energy provider E.On is making changes to how it bills customers which will see the average standard variable tariff rate rise by £22 a year.
The changes are due to come into place on 19 April for existing customers. E.On said the removal of various discounts would make it easier for customers to understand its tariffs and to compare them with competitors.
Price comparison service Energy Helpline said the rise could be up to £50 annually for some E.On customers.
It said the bill increase was “bad news” for customers. A spokeswoman for E.On emphasised that the firm had “made no changes” to the prices it was charging for electricity and gas units.
It said the increase in customers’ bills was due to the removal of some of the discounts currently offered to customers for paperless billing and using both electricity and gas.
“We believe this will make it simpler and easier for customers to understand our tariffs and compare them with other suppliers in the market, the majority of whom do not offer these discounts,” the spokeswoman added.
The firm has also increased its standard charge for customers who pay their bills by cash or cheque to £10 per fuel per year.
It said the majority of its customers, almost three quarters, paid their bills by direct debit.
“The impact on our customers’ bills will vary depending on payment method, bill choice and fuel selection,” the spokeswoman said.
New legislation to allow energy regulator Ofgem to limit how much companies can charge customers for their standard variable tariffs is expected to come into effect next winter.
The law will limit the cost of firms’ standard default tariffs until 2020. Following that, the cap may be extended on an annual basis until 2023.