Price rises mean £1,000 home energy bills 'will be the norm'

Five million people will pay almost 15 per cent more for their gas because soaring wholesale prices have prompted one of the country's big suppliers, EDF Energy, to increase its charges.

Customers with EDF Energy, London Energy, Seeboard and SWEB, said electricity bills would rise by 4.7 per cent and gas by 14.7 per cent. The price rises follow Scottish Power's announcment of rises of 8 per cent for electricity and 15 per cent for gas last week. British Gas, the country's biggest energy supplier with 11 million customers, is expected to announce hefty price rises within weeks.

The consumer champion, Energywatch, warned that EDF's move meant an average energy bill for gas and electricity of £1,000 a year could become the norm.

Derek Lickorish of EDF said: "With soaring wholesale energy costs, we have been forced to raise our prices. However, through ownership of our own generating capacity, we have been able to limit the overall rise for all our customers."

The increases take effect from 13 March, adding £15 a year for a typical electricity customer and more than £68 for gas. EDF said that 300,000 customers on capped or fixed rates would not be affected by the announcement, which follows a rise in wholesale gas and electricity costs of up to 100 per cent since January last year.

The latest round of rises will heighten the focus on the European gas market, which consumer groups say has resulted in British consumers paying "grossly-inflated" prices for energy. While European gas markets are indexed to the oil price, Britain is no longer shielded from the effects by meeting its domestic needs from the North Sea. There are also concerns over importing too much gas from Russia, which has cut off supplies from neighbouring countries in recent disputes.

Energywatch said its research showed EDF had increased gas prices by 57 per cent since 2003 while electricity was up by 41 per cent. Adam Scorer, of Energywatch, said: "Average price rises are being continually pushed up and it won't be long before we see £1,000 energy bills as the norm. We are faced with a doubling of the number of households in fuel poverty who face the daily decision to eat or heat."

EDF - owned by France's state electricity company - said the price rise announced today for dual fuel customers was 10.6 per cent.