Scottish Power to cut average gas bill by £32 from March
Scottish Power has announced it is to cut its standard domestic gas prices by an average of 5.4% from mid-March, the third supplier to announce such a drop in two weeks.
Scottish Power said the reduction, effective from March 15, would benefit more than one million customers and reduce the average annual standard gas bill by £32.
It follows SSE announcing on January 28 that it will lower standard gas tariffs by 5.3%, also saving household gas customers on average £32 a year, and E.ON saying on January 20 that it will lower gas prices by 5.1% from February 1.
Neil Clitheroe, Scottish Power's chief executive of retail and generation, said: "Over the past year, we have tried to always offer our customers competitively priced dual fuel tariffs.
"This has encouraged more of our customers to switch between tariffs with now close to one in two on fixed price products. This is one of the highest proportions of fixed price customers of the major suppliers."
The cuts come as the industry faces a backlash amid calls for cuts to be faster and deeper.
Consumer groups have said households are not seeing the full benefits of recent steep falls in wholesale energy prices.
The Competition and Markets Authority (CMA) has been investigating the energy market since last summer.
An early report by the CMA last February found that the large companies were overcharging loyal customers who did not switch suppliers by up to £234 a year.
Ofgem's senior partner for consumers and competition, Rachel Fletcher, said: "This is a movement in the right direction for loyal customers, but the size of today's price cut is dwarfed by the savings available by switching from a standard tariff to a fixed deal.
"You could save more money - up to £300 - faster by switching. It's easy to shop around and impartial advice and links to Ofgem-approved price comparison sites are available from www.goenergyshopping.co.uk."
Ann Robinson, uSwitch.com director of consumer policy, said: "ScottishPower is doing the right thing with a price cut but, yet again, it falls well short of what customers have a right to expect.
"This is yet another demonstration that the energy market is broken. In a healthy, competitive market, drops in wholesale prices - which make up around half of bills - would be passed on. We should be seeing reductions of at least 10% on standard gas and electricity tariffs.
"Instead of waiting around for token-gesture price cuts, Big Six standard plan customers should do their own price cut by switching to a cheaper fixed deal, saving more than £320 a year."
Citizens Advice chief executive Gillian Guy said energy companies are " finally waking up to calls to cut high bills".
She said: "It's encouraging Scottish Power has become the third Big Six company to cut its gas bills. But customers will have to wait until March to feel the benefit.
"All customers should be feeling the benefits of plummeting wholesale costs so other suppliers must now follow and reduce their prices too.
"More could still be done to help consumers and we urge all firms to cut deeper and faster."
Energy Secretary Amber Rudd said: "I am putting bill-payers first and am absolutely clear that energy companies must do the same by passing on savings to them. Scottish Power has taken a step in the right direction but the Big Six need to up their game to compete with the other 30 suppliers now available thanks to Government action.
"By helping more and more suppliers enter the market, Government is ensuring that hardworking families and businesses don't have to get stuck on expensive deals. We are also making it easier and quicker to switch, rolling out smart meters to every home and business, and will continue to increase competition in the energy market."