SSE's Managing Director, who is due to face MPs later today, explains why customers are experiencing a 8.3 percent increase in their bills.
After SSE announces gas and electricity tariffs will prices will rise next month, other big energy firms refuse to rule out own price hikes.
Some tips on how to save money on your energy bills.
Energy giant SSE insisted it was battling "difficult" energy market conditions as it revealed a £115.4 million loss in its retail supply business just weeks after announcing a hike in household bills.
The group, which has more than nine million customers and is the UK's second largest generator of electricity, blamed the performance on rising costs of wholesale energy, environmental and social policies and distribution.
Its overall underlying group profits fell 11.7% to £354 million in the six months to September 30.
The first half loss in its retail supply arm compares with a £48.3 million operating profit a year earlier.
SSE was the first of the major suppliers to announce a tariff rise, saying last month that it would lift prices by an average of 8.2% from Friday.
There is a "continuing argument" raging in the Coalition Government over the merits of investing in a low-carbon economy, according to Business Secretary Vince Cable.
He told BBC Radio 4's Today programme: "It is a continuing argument in the coalition, because Liberal Democrats have been arguing that we need to maintain a long-term priority towards a less carbon-based and polluting economy, and we have to make the decisions associated with that."
Business Secretary Vince Cable has said that calls for the Government to axe green policies in the hope of bringing down the price of energy are "short-sighted and foolish".
He was responding to a suggestion by the chief executive of energy firm SSE that Britain should consider "retreating from decarbonisation".
Mr Cable told BBC Radio 4's Today programme: "The rise in energy prices is due to a whole variety of things, by far the most important of which is what's happening in world energy markets.
"We've had over a period of years very rapidly rising demand in Asia, particularly in China, we've had restrictions on supply from countries like Iran."
He added: "If you are taking a long-term view about shifting the British economy on to a less polluting, less carbon-based system, we have to provide those [green] incentives."
The chief executive of SSE, who yesterday announced price rises of up to 10%, said the rise would be "helpful" if it focused the nation on the spending priorities and opened a debate on the "green agenda" he claims is driving up prices for consumers.
In an interview with the Daily Telegraph, he said:
"A price rise is never a good thing to do, but if it focuses everyone on to a debate about what we as a nation should be spending money on, then in one way it will be helpful.
"We need to think about what people really want to pay for; maybe it's time to retreat from decarbonisation and focus more on the cost of living. I think we have to have a debate about it.
"Do we want to be replacing one bit of (energy) generation that we can keep going for a bit longer with a new bit of generation that's going to cost more?"
"I doubt the public like price increases of this magnitude, but if we carry on firmly behind the green agenda we will continue to have price increases like this."
Sources close to Number 10 pointed out that this energy price hike demonstrates that a temporary freeze by a government wouldn't achieve anything at all.
The energy companies would simply increase prices ahead of an increase as SSE has done today and they would also raise prices after the temporary freeze, they claim.
The Prime Minister's spokesman said effectively that it was "a con".
When I put this to Ed Miliband, he rejected those arguments saying that market intervention could work.
When I suggested the logic of his argument was nationalisation, he said "not at all".
SSE's price hike is also dismal news for customers of other energy firms - one industry insider who has regular confidential briefings with them tells me "behind the scenes they are all talking about similar rises."
As SSE tell us how deeply they regret the price rise - let's note that they make 5% profit, which is higher than retail giant Tesco.
Also let's reflect on the fact that bills are going up more than 8% while wholesale prices are only up around 4%.
SSE's new average dual fuel bill will now be £1,465 - it's the level where we know people become so squeezed that they turn heating down....or off.