Consumers could be in for a summer of significant energy price hikes, an independent price comparison and switching service has warned.
SSE Airtricity announced the first energy price hike of the summer, following last winter’s slew of increases.
The supplier decided to increase gas and electricity prices from July 14, which means that the average dual fuel customer will pay an additional €140 per year.
Managing director of Switcher.ie, Eoin Clarke, said the price hike could be a portent of things to come.
SSE Airtricity said the price increase was in response to higher wholesale costs and that a typical household dual bill would increase by 8.9% on average, or €2.70 a week.
For single fuel customers, the standard price of electricity will increase by 6.4%, or €1.13 a week, while the standard price of gas will rise by 12.3%, or €1.57 a week.
The company said it was the first gas price increase since 2013 and the second in electricity prices over the same period. It increased its electricity prices by 5.6% last November.
“It follows a period of successive price cuts from 2015 during which SSE Airtricity reduced its standard gas and electricity prices for customers by 9%,” it added.
Mr Clarke said the price hikes should be a wake-up call for SSE Airtricity’s customers and, judging by the trend last winter, could be a sign that other suppliers would follow suit.
Mr Clarke said the price hikes would have a “big impact” as the colder months began to creep in.
SSE Airtricity blamed continued volatility in wholesale prices for the increases, pointing out that the price of gas had risen by over 20% in the last 12 months.
Its director of home energy, David Manning, said it had done everything in its power to protect customers form wholesale market volatility.
“We’ve kept our gas prices as low as possible, particularly during the recent harsh winter and we’ve worked hard to reduce our own internal costs at the same time,” said Mr Manning.
“However, we continue to experience sustained increases in wholesale costs and, regrettably, these eventually have to be reflected in our prices.”
Price comparison and switching service Bonkers.ie also warned that other suppliers were likely to increase their prices too.
“The last time SSE Airtricity announced a price hike last September six other suppliers followed suit in the proceeding weeks,” said Bonkers.ie spokeswoman Robyn Hamilton.
While customers would be hoping that it was not the first hike of many, they could reduce their consumption or switch to a cheaper supplier to offset the pending increases.
The Commission for Regulation of Utilities said the price increase announced by SSE Airtricity followed other price rises by suppliers since October last year.
The commission said global wholesale gas prices had continued to increase since the end of 2016, putting pressure on current retail prices being offered to customers.
“While the CRU does not regulate energy prices, it does actively monitor price and other trends in energy retail markets to ensure competition continues to benefit customers,” it said.
The commission said consumers had the opportunity to switch, save and beat energy price rises by switching or negotiating a better deal with their supplier.
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