Other 'big six' firms hold back from upping prices hoping to win over SSE customers after last week's 8.2% increase
More than 50,000 energy consumers have switched their suppliers and many more are expected to follow on Monday in the aftermath of the 8.2% price increase levied by SSE last week, experts say.
Other "big six" energy firms are believed to be temporarily holding back their own plans to raise bills in the hope they soak up new customers opting to leave SSE.
The mass switching will be welcomed by the government, which had urged consumers hit by the price rise to find cheaper options rather than passively accept an increase in the cost of living.
Paul Green, the marketing manager at Energyhelpline, said that at the end of last week his switching company had had six times the activity seen on normal days.
"I would think that around 50,000 people overall have switched their energy providers – not necessarily all from SSE – following the price rise. We would expect to see more activity on Monday ," he explained.
Green said any price rise triggered a frenzy of activity as customers reviewed their energy bills and considered whether their providers would raise prices.
"If British Gas had raised its prices the peak in activity would have been even higher because it is by far the largest supplier but SSE is the second largest so it was bound to be significant."
Often suppliers quickly raise their prices once a rival has taken the first step. While Energyhelpline expected others to follow suit, it believed there might be a delay as rivals try to win those customers who have bailed out of SSE or have just decided to leave their own provider.
But other City experts said companies such as British Gas were holding back increases in the hope that the government would come up with ways of removing some responsibilities and costs, such as the ECO energy company obligation to provide lagging and other measures for poorer homes. Downing Street confirmed last Friday that the government was considering ways of cutting financial support in a bid to reduce overall fuel bills.
Energy companies including SSE have been campaigning for environmental measures to be taken off bills and put on to generation taxation while others want them scrapped completely.
The SSE price rise – the first to be announced by one of the big six this winter – will take effect from 15 November and force up the cost of living for more than 7 million customers.
SSE blamed government policy charges and green levies for the increase, which it insisted equated to an average rise of just £2 a week on most bills.
Michael Fallon, the energy minister, encouraged people to consider switching to one of the company's rivals."The best answer here is more competition. I would encourage customers to look at the tariffs they are on, and see if they can switch. That competition is best," he argued.
But the Labour leader, Ed Miliband, made an impassioned attack on SSE, accusing it of ripping off customers and said the latest "scandal" showed why the government needed to act.
But David Cameron responded by saying the proposal to freeze energy prices, first unveiled by Miliband at the Labour conference two weeks ago, was a "con" because the increases were driven by international pressures and a moratorium would not help.
Article Source : http://www.guardian.co.uk
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