npower faces tough questions over prices

JUSTIFY these prices, now!That is The Evening Star's cry today as we launch our Energy Watch campaign aimed at highlighting the unfairness of charging people in Suffolk more to heat their homes.

JUSTIFY these prices, now!

That is The Evening Star's cry today as we launch our Energy Watch campaign aimed at highlighting the unfairness of charging people in Suffolk more to heat their homes.

Households in the county are facing bill increases of more than £200, simply because they are deemed to live in the wrong region by energy supplier npower, which is putting up gas charges by 23per cent and electricity prices by 17pc in the region, around 5pc more than other parts of the country.

Yet the National Grid has revealed that East Anglia is one of the cheapest regions in the country when it comes to distribution of gas.

And today Daphne Savage, chief executive of Age Concern Suffolk, said the price hikes could cause serious problems for the county's pensioners who were already struggling to pay their heating bills.

She said: “We're hugely concerned about it. We were concerned before but these rises are really large.

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“Retired people often have very low fixed incomes and the proportion of their income they pay on heating bills is higher than working people, so this exacerbates the problem for them.

“'Heat or eat' is an emotive phrase but energy bill increases means something else has got to give because they can't pay for everything.

“This really is worrying because they are such large rises.”

And energywatch, the independent body tasked with regulating the industry, added its voice to the debate, claiming npower cannot justify large regional variations in prices, which hit people living in the East and London.

A spokeswoman for energywatch said: “npower's move could mean the development of regional gas markets with consumers having different unit costs for gas depending on where they live.

“There are some regional differences in transportation and gas distribution costs, but there is no way that suppliers can explain differences that see some areas paying so much more than other parts of the country.”

EDF Energy said it currently charges a flat rate across the country but said it continually reviews its prices.

British Gas charges the same to its gas customers across the country but varies its electricity bills according to region.

Are you struggling to pay your energy bills? Are you angry about the regional price hikes? Contact The Evening Star news desk on 01473 324788 or e-mail starnews@eveningstar.co.uk.

npower's response

npower has insisted the price hikes in the East are a reaction to regional variations in the amount energy distribution companies, such as the National Grid, charged suppliers.

A spokesman for the company said East Anglia's close locality to Bacton in Norfolk, where most of the UK's power enters the country, had no impact on the costs.

He added: “It would be easy to fall into the trap of thinking if you live next to a power station it will make bills cheaper, but it won't.

“It bears no resemblance to the cost of transport or distribution.

“The reason behind the increases is the costs that have been passed to us by the distribution and transport companies.

“Each distribution company charges a different rate for us to use their pipes. Costs are passed on through to consumers.

“We have the policy of not penalising one customer to help another. Some companies may go for a flat rate but why would someone living in Leeds or Birmingham have to contribute to someone living in different parts of the country.

“It is fairer this way.”

When the Star put to npower the National Grid figures which show the East is the third cheapest area to distribute gas to the spokesman issued this statement: “There are eight gas distribution networks of which four are still owned by National Grid. (They are) sub divided into 37 smaller exit zones all with their own cost profile.

“To keep things simple we map these across to our own electricity regions and take a weighted average to work out the cost which then translates into the price we charge.”

The spokesman also stressed that any customers worried about paying their bills should contact their energy supplier to discuss their options.

The average cost of distributing gas to each costumer per each

East of England - £110

London - £127

North west - £111

West midlands - £117

Wales and the west - £115

Northern - £105

Southern - £119

Scotland - £106

Average for the eight networks - £114

SOURCE: National Grid

Figures correct as of October 1, 2007