E.On has blamed “increasing policy costs and other costs it doesn’t control”, for an  average 8.8% increase in its standard variable tariff from Wednesday 26 April.
It blamed the rise “in large part” on increases in “non-energy parts of the bill such as social and environmental schemes”. It said the cost of supporting the Renewables Obligation (RO) and Electricity Market Reform (ie the Capacity Market and Contracts for Difference) along with the Energy Company Obligation, had risen by 36%. It said falls in wholesale market prices had only partially offset the increase.

The company’s standard electricity prices will increase by an average of 13.8%, while standard gas prices will increase by an average of 3.8%, affecting 2.5 million domestic customers – 62% of the company’s total.
Tony Cocker, chief executive of E.On UK, said the company would be encouraging customers to move from standard tariffs: “We will be sending more than three million letters to customers this month with personalised savings messages making it clear how easy it is to swap to another tariff that might offer cheaper prices. In addition we will also be working to contact a number of potentially vulnerable customers currently on our standard variable tariff with a personalised quote for an exclusive product, which will be E.On’s cheapest tariff,” he said.
The letter will have a tear-off permission slip to switch to the new tariff.
The company has meanwhile launched a new 24-month fixed tariff, E.On Energy Fixed 2 Year v10.

It also plans to trial ‘Energy Direct’ – sales forces in town centres “engaging customers who may be less likely to respond to other methods”.