Labour has denounced a hike of up to 10 per cent in gas and electric bills for millions of households, accusing the Government of failing to get a grip on profiteering suppliers.
Energy giant SSE sparked fury by announcing rises that will add £106 to its typical dual-fuel customer bill – pushing it up to £1,380 a year.
The move is expected to trigger a series of increases by the other “Big Six” energy suppliers – Centrica, EDF, ScottishPower, E.ON and npower.
Will Morris, group managing director of retail at SSE, apologised to customers but said it had been forced to raise tariffs amid rising costs. The company said wholesale energy prices were up four per cent, paying to use newly-upgraded networks by 10 per cent and Government-imposed levies up 13 per cent.
“We know we will come in for a great deal of criticism for this decision and politicians will no doubt be lining up to condemn us,” Mr Morris said.
“But over many years policymakers themselves have failed to highlight adequately the cost to consumers of the policies they have pursued in government.
“They can’t expect to have power stations replaced with new technologies, the network to be upgraded and nationwide energy efficiency schemes all to be funded for free.”
However, Labour leader Ed Miliband insisted the suppliers were “ripping people off” and said the increases – which will come into force on November 15 and affect an estimated 7.3 million customers – reinforced the need for a 20-month freeze on energy prices.
“The Government is letting the energy companies get away with it and letting down the British people,” he said.
“The companies are putting up prices because we’ve got a broken energy market and they are ripping off consumers.
“This latest scandal shows why the Government needs to act. The companies are trying to blame everyone else, the Government is trying to blame everyone else.
“They’re responsible, they’re not getting a grip. We would get a grip, we’d freeze prices, we’d reform a broken energy market.”
Energy Secretary Ed Davey denied green levies were a major factor in driving up prices, and urged customers to look elsewhere for cheaper bills.
“This is clearly unwelcome news for customers of SSE. People should take the opportunity now to make sure they are on the best deal available to them,” he said.
A spokesman for the Prime Minister said the Government was encouraging competition in the energy market – but stressed that sustainable prosperity, with low mortgage rates, was what had the “fundamental impact” on living standards.
Martin Lewis, of the Moneysavingexpert website, said the price hike would mean many people this winter will have to choose “between heating and eating”.
“The most important thing to understand is that the Big Six energy companies are like sheep – where one goes, the rest will almost certainly follow in the next three months.”
Regional variations mean rises will range from seven per cent in northern England and parts of Scotland to 9.7 per cent in the South East. They will be higher for those who use a high proportion of cheaper energy at off-peak times.
SSE, which trades as Southern Electric, Swalec and Scottish Hydro, pledged not to lift prices again for a year.
It last increased tariffs a year ago, by nine per cent, just before a bitterly cold spell.
The bad weather helped the FTSE 100-listed firm to increase annual profits at its household retail arm by 28 per cent to £410.1m as gas consumption soared by a fifth.
Overall pre-tax profits in the year to March rose from £1.34bn to £1.41bn.
But in a trading update last month, SSE revealed that it made a loss on its retail operations over the summer as wholesale prices rose.