By Ed Ballard
LONDON--The U.K.'s biggest energy providers will cut customers'
gas and electricity prices to reflect regulatory changes, the
government said Monday.
A plan to provide free home insulation to low-income households
will be slowed down, while the government will support a 12 pound
($19.68) rebate to cover the cost of a levy that supports people
who can't afford to heat their homes. The government said all the
U.K.'s major energy suppliers confirmed they will pass the savings
to customers.
Confirming the changes, Centrica PLC (CNA.LN), said the revised
rules will result in an average annual saving of GBP53 for gas and
electricity, while SSE PLC (SSE.LN) forecast an average saving of
around GBP50.
"British Gas is pleased to be cutting energy bills by an average
of GBP53 from 1 January," said Chris Weston, Managing Director of
Centrica-controlled British Gas. "We've been able to do this
because the government has committed to making changes to the
environmental and social obligations that are paid for through
energy bills."
SSE also said it will extend its price cap for Autumn 2014 to
Spring 2015 unless its costs rise dramatically.
"We promised our customers that they would benefit from any cost
savings and although there is some detail still to be worked out,
we are able to commit to lowering our prices," said William Morris,
managing director of SSE's retail division.
Centrica said it will cut prices from Jan. 1, while SSE said it
will do so before the end of its financial year to March 31. The
cuts come less than two months after both companies hiked
prices--Centrica by 9.2%, SSE by 8.2%--citing higher energy prices
and the cost of government-imposed tariffs. Labour Party leader Ed
Miliband recently pledged to freeze energy prices for a year.
Write to Ed Ballard at ed.ballard@wsj.com
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