npower News: How will npower’s latest price hike news impact UK Business?
It’s been all over the news, npower has bumped up its prices by 9.8% and consumers are livid!
Blamed on the Government’s Smart Metering programme and wholesale prices putting pressure on suppliers, Theresa May has threated to intervene, proposing that a price cap be placed on domestic energy bills in order to protect homeowners from escalating prices.
But, what about businesses? Will they suffer the same fate as homeowners?
Why are npower increasing their energy prices?
npower are increasing their prices due to pressure from the Government to partake in smart energy schemes and wholesale prices driving costs up. While the price hike has been met with infuriation by certain sections of the press, it should be recognised that this is the first price increase announced by the Big Six supplier since October 2013.
The energy market has long been criticised for its lack of regulation and price changes. There have been numerous calls for additional controls to be put in place, in order to protect customers and ensure the industry is working effectively to promote the consumer’s best interests.
However, it should be noted that npower’s domestic prices have changed little over the last three-years and so the latest hike is simply bringing prices in line with wholesale costs, reflecting the current market. Those suppliers who try to keep prices low will have to re-coup the prices elsewhere (possibly without the customer knowing), or risk going out of business.
When will npower increase their prices?
Prices are set to increase from 16th March 2017 with the cost of typical dual fuel energy bills going up by 9.8% or about £109 a year on average.
Current domestic Standard Variable Rate tariff customers, who make up around 50% of npower’s customer base (about 1.4 million customers) will have the option to freeze prices until 2021, for more information please click here.
How will business energy prices be affected?
Business energy prices will not be affected. The increase will only affect domestic customers on npower’s Standard Variable Rate tariff meaning only half of the supplier’s customers will be affected.
According to an official statement from npower officials:
“Half (1.4m) will not receive a price increase. This is because npower has a higher percentage of fixed-rate tariff customers than most large suppliers, and because pre-payment customers are not affected.”
In contrast to domestic electricity and gas bills, commercial energy prices fluctuate regularly, due to the volume of energy required, and are therefore more reflective of current market prices.
Business customers will not see much of a change in their prices, and those on a fixed price tariff will see no change at all. Those npower customers who are up for renewal may even be eligible to benefit from a slight decrease, based on prices Love Energy Savings received at the back end of last week.
However, in order to benefit from lower prices, it’s vital that business energy customers do not simply roll over onto an out-of-contract rate. These typically tend to be 40% higher than if you switched to a new tariff, even if it’s still with the same supplier.
Are you on the best business energy tariff?
To see if you’re eligible for business energy savings just call one of our friendly energy experts today on 0800 9888 375 and ask about current tariffs available for your business.
Alternatively, if you want to view available prices in a matter of seconds simply click the button below to compare now.