Power NI is hiking electricity bills by nearly 7% to an average of £610 a year for its almost half a million customers.
n a move rubber-stamped by the Utility Regulator, Northern Ireland’s biggest electricity supplier is putting up its rates by 6.9% from July — an extra £39 a year for the typical customer.
Power NI admitted it was “not the ideal time” for the hike but said it was responding to increases in the cost of wholesale electricity. The regulator said low-wind patterns were also a factor.
The rise means that as households face the end of the Government’s Coronavirus Job Retention Scheme in October, they will also have to contend with paying more for their electricity.
Rivals of Power NI, which supplies 450,000 households, are likely to follow suit later in the year. Power NI said the move amounted to an extra 76p a week.
There have been warnings of rising prices as a result of the pandemic. Gas supplier Firmus recently hiked its prices by 14%.
Sinn Fein East Londonderry MLA Caoimhe Archibald said: “This is yet another example of the unreliable nature of having an industry based on a resource as volatile as fossil fuels.
“Those hardest hit by this will be low and middle-income families, many of them already struggling to make ends meet.”
Power NI said the rise brought prices back to 2019 levels following a drop last year and that its charges were below those in Great Britain and the Republic, where average annual bills are £736 and £846 respectively.
Director of product solutions William Steele said: “We work very hard to keep our prices as low as possible, but regrettably world fuel prices have been increasing over recent months.
“Like other suppliers, we have no choice but to pay these increased costs, which have a knock-on effect on our tariffs.
“We held off making this change for as long as possible, with this price change not coming into effect until July. As soon as we see an opportunity to reduce prices, as we did last year, we will do so without delay.”
He said customers who register for online billing would offset the increase and save £60 a year.
SDLP Foyle MLA Sinead McLaughlin said the increase was “very regrettable”.
“Many households have lost employment during the pandemic, while others who are dependent on casual work have lost access to income. This will be a very difficult price rise for them to bear. The timing is extremely unfortunate,” she added.
“Worse still, it follows hard on the heels of a 14% price rise for many gas customers. Given the high level of fuel poverty in Northern Ireland, this will make a bad situation worse for many.”
The Consumer Council said that for the typical Power NI customer with a credit meter, bills would rise by £39 a year.
Interim head of energy Raymond Gormley added: “While this is unwelcome news for consumers, we are aware the main driver is the significant rise in the wholesale costs for energy globally over the last year.
“We work closely with the Utility Regulator to ensure consumers are protected and no unnecessary costs are added or additional profits are made.
“Any customers who are struggling to pay their bill should contact Power NI without delay to discuss their available options.
“We would encourage consumers to think about ways they can reduce energy costs. Switching payment option, changing billing method or switching supplier can save some money.”
John French, chief executive of the Utility Regulator, said it had accepted the 6.9% increase after “thorough analysis”.
“The main driver behind this tariff increase is a rise in wholesale electricity costs… and low-wind weather patterns,” he said.
“We recognise this is not the ideal time. We have not taken this decision lightly, but unfortunately it reflects the actual cost of supplying electricity to homes.”
Economist John Simpson said: The increase of 6%, when the inflation rate is below 2%, is very disappointing. But I have heard that the wholesale price of gas in recent days has been up by an enormous percentage. It is really a bit difficult to understand why that should happen at this time of year whenever central heating is less needed. We usually expect fuel prices to ease off at this time of year.
“It’s disappointing, but for some reason wholesale prices have been behaving in a way which is not as we would have expected. Therefore, I expect we have to give the regulator a pass mark if he’s done the figures carefully, which I’d say he probably has.”
Consumer price inflation rose to 0.7% in March after falling to 0.4% in February. It is expected to climb further due to a rise in regulated household energy bills in April, higher global oil prices and because of the comparison with last year, when demand slumped due to the onset of the pandemic.
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