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E.On announces 5.1% cut in gas prices

Posted by Anna Carlini on 21 January 2016 at 11:30 am

Energy Provider E.On has just announced a 5.1% cut in their gas prices. It is the first of the 'big six' energy providers to make cuts in the last six months. It is long-awaited news, but not everyone is greeting it with open arms.

British Gas lowered their gas prices by 5% in August 2015, but the other five held back, despite the cheaper price of wholesale gas the industry has been enjoying recently.  As a result, pressure has been building on the biggest energy companies. Both the Prime Minister and Dermot Nolan, the Chief Executive of Ofgem, have called for lower prices to see the benefits of cheaper gas being passed on to the customer.

E.On has claimed this 5.1% cut as equivalent to £32 off an average home's gas bill, but is it enough? The much anticipated announcement is being received with a mixture of relief and dissatisfaction by homeowners. Many feel that it just does not pass on enough of the savings to the public. Ann Robinson, director of consumer policy at USwitch, agrees and has argued that a cut of 10%, equating to £120 off the gas and electricity bill would much better reflect the big drop in wholesale prices. The wholesale price of gas is currently about half what it was at the start of January 2014.

We will wait and see who is the next to make cuts, and how big they will be, but until then the option to switch providers and make the most of better deals elsewhere is certainly a smart move that could save you money.

Image: Elentari86

Source: BBC News

See also: What are Tariff Information Labels, Tariff Comparison Rates and Personal Projections and how do they help get the best deal on energy bills? and Are you paying too much for your energy?

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