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Davey: Customers should cash in on gas price war

Energy Secretary Ed Davey has urged homeowners to cash in on the gas price war and switch suppliers to get the best possible price.

As npower becomes the latest Bix Six energy firm to slash bills, with a cut of 5.1 per cent, the Lib Dem MP also urged SSE and EDF to follow suit and cut tariffs.

It comes amid plummeting wholesale costs, with Ofgem revealing prices have fallen by 19 per cent year-on-year.

Energy chiefs say more gas bill cuts 'under review'

More gas bill cuts could be on the cards if wholesale prices continue to fall, bosses at energy firm npower have promised.

Chief executive Paul Massara vowed that bills would be kept under review - and said the firm had cut tariffs as much as possible amid plummeting wholesale prices, while reflecting increasing costs elsewhere.

Bosses claim they have had to balance falling wholesale prices with increasing costs elsewhere Credit: PA

The announcement of a 5.1 per cent price cut by npower - the largest drop of the Big Six firms - comes as wholesale energy prices fall by around 19 per cent.

Today's announcement means we can get the benefits we are seeing in the wholesale market to our customers pockets as soon as possible.

We have balanced this wholesale price fall against increases in the other costs we are charged. If there are further falls in wholesale prices, we will keep these under review to see if we can cut further.

– Paul Massara, npower chief executive

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Energy firm npower to slash more than 5% off gas bills

Energy giant npower has become the latest firm to announce a cut in gas prices.

From February 16, the supplier will cut its standard gas tariff by an average of 5.1 per cent - the biggest price cut of its competitors - benefiting its 1.3 million customers by around £35 a year.

More than half of the so-called Big Six energy firms have now reduced tariffs this month Credit: PA

It comes after British Gas announced a five per cent cut in prices, E.ON reduced tariffs by 3.5 per cent, and Scottish Power announced a 4.8 per cent drop in prices starting February 20.

It means more than half of the so-called Big Six energy firms have now reduced tariffs this month, in line with a sharp fall in wholesale costs.

SSE and EDF have not yet announced any changes.

Scottish Power to cut gas prices by 4.8%

Scottish Power has become the latest energy firm to reduce gas prices, after announcing a 4.8% cut from February 20.

Scottish Power is the third of the Big Six energy companies to cut its prices. Credit: PA Wire

The firm, owned by Spain's Iberdrola, said the cut will reduce annual gas bills on a standard tariff by £33.

It also announced a new fixed-price deal which it said was one of the most competitive in the marketplace with an average dual-fuel bill of £930.

It comes a day after British Gas announced a 5% cut in prices and a week after E.ON reduced prices by 3.5%.

Half of the so-called Big Six energy firms have now reduced tariffs this month in line with a sharp fall in wholesale costs.

SSE, npower and EDF have not yet announced any movement in their pricing structure.

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British Gas: 'We've done as much as we could'

British Gas say a 5% reduction in gas prices is "as much as we could as fast as we could".

Christine McGourty, Director of Corporate Affairs, said: "The 5% cut is greater than any other cut in the market so far."

The energy firm, who have benefitted from falling wholesale gas prices, will only reduce bills from the end of next month.

They were accused of "double standards" after hiking prices with immediate effect when wholesale prices rose in 2008.

ITV News Consumer Editor Chris Choi reports:

  1. Chris Choi

British Gas customers 'may not be jumping for joy'

British Gas will have to live with the fact that many of their customers won't be jumping for joy over this news.

British Gas has announced a price fall today. Credit: PA Wire

The wholesale market has been dropping for months, with wholesale costs for the next 12-month contracts down 28%.

In that context, this 5% drop can look a little bit mealy-mouthed.

The remaining big six companies that have not dropped prices yet have not given any firm signals that they will reduce prices.

If you look at when British Gas raised its prices by 35% in 2008, the new tariff came into force with immediate effect.

Today's reduction won't come in until the end of next month - some people will see that as an unfair contradiction.

Miliband: 5% price cut is too late and not nearly enough

Ed Miliband has said a 5% cut in British gas household prices is "too little, too late" and "not nearly enough".

Ed Miliband has criticised the size of the British Gas price cut. Credit: PA Wire

"Wholesale prices have fallen by 20% so what I would say to that company and to the other companies is actually that they should pass on the benefit to consumers," Mr Miliband told voters at an event in north-west London.

"A 5% fall is too little and it is too late. It is not nearly good enough."

The Labour leader, who has proposed an energy price freeze if he is elected in May's general election, added: "If the Conservatives want a competition about who can properly stand up to the energy companies, I say bring it on.

"This Government has stood by as energy prices have gone up and up and done nothing about it."

PM: Cut wouldn't have happened 'if we listened to Labour'

David Cameron has told ITV News that energy suppliers like British Gas would not have cut its prices if the Government had "listened to Labour" and enforced a price freeze.

"This is excellent news and we should be absolutely clear that this price cut would not be happening if we'd listened to Labour and put in place their 20-month price freeze," the Prime Minister said after British Gas announced it was cutting household bills by 5%.

"If we'd frozen prices, you would not have got this benefit to hard-working families up and down the country who want to see their energy bills come down - and with this news, that's what is going to happen."

Labour has said the fall "is too little and too late" and "not nearly good enough" when wholesale prices have fallen by 20%.

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