Co-op Energy to cut fuel prices

The independent energy supplier is the first company to announce cuts in energy rates this winter. The news comes around four months after Britain’s six largest providers – EDF Energy, E.ON, RWE npower, Centrica, SSE and Scottish Power – passed on steep increases.

High energy bills drove UK inflation rates to a three-year high in September, with consumer prices rising 5.2 per cent year-on-year, the second-highest gain in the European Union.

British gas for delivery in summer 2012, a current benchmark contract, has fallen 15 per cent since early August, around the time when the first winter price rises were announced.

Nigel Mason, Co-operative Energy’s business development manager, said: “This autumn’s exceptionally mild weather has led to a drop in wholesale prices, so we’re passing on those savings as soon as we possibly can.”

He said the subdued economic outlook, diminishing concerns about supply cuts from the Middle East and hopes for new gas reserves in the form of shale gas have also helped weigh on wholesale prices.

The small supplier, which entered the market in May this year, announced a price increase in late September of 18 per cent for gas and 11 per cent for electricity but is the first UK provider to slash bills on the back of recent wholesale price drops.

Co-operative Energy, which supplies more than 16,000 customers in the UK, will slash power bills by 3.5 per cent and gas bills by 2.5 per cent from February 1.

Britain’s EDF Energy, E.ON and SSE said yesterday they were constantly reviewing prices. A spokesman for SSE said: “If we are in a position to reduce prices, then we will.”

Many of Britain’s ‘Big Six’ energy suppliers said they would freeze energy tariffs until next year when they announced high rises earlier this year. These large suppliers control 99 per cent of the market.