GAS WATCHDOG IN PRICE RISE WARNING ; Fears After Ukraine Energy Row
Posted on: Monday, 2 January 2006, 06:00 CST
By Joe Churcher
ENERGY firms could exploit fears over a gas supply dispute between Russia and Ukraine to hike prices again, consumer watchdogs warned yesterday.
Energywatch chief executive Allan Asher hit out at rises already being made - two of which took effect yesterday - saying there was "no excuse" for them.
The bad news for bill payers follows a raft of recent price increases.
Moscow denies that the decision to cut the flow of gas to its neighbour will affect exports to western Europe.
But Asher said that would not stop energy companies using the crisis to push up prices - despite the fact that Britain does not use gas from that part of the world.
He said: "However, it might create some shortages in western Europe which might put a bit of pressure on prices there and, sadly, the gas and oil companies are always looking for excuses to ramp up the prices.
"So it would be the fear, uncertainty and doubt that causes the problem, not physical supply.
"Coal prices are falling, oil prices are falling - those were the things they told us were the causes of price rises last year."
The news came on the day that 11million British homes - supplied by two firms - went on higher charges.
Scottish and Southern Energy (SSE) are increasing gas bills by 13.6 per cent or around pounds 50 on the average bill - and electricity charges by 12 per cent, or about pounds 30.
Rival company npower also chose yesterday to put up their prices by 14.5 per cent for gas and 13.6 per cent for electricity - adding pounds 58 and pounds 38 respectively to a typical bill.
The pair announced plans for the price rises in November.
It is the latest round of rises after a surge in wholesale gas prices, partly due to the loss of UK self-sufficiency on gas with dwindling North Sea supplies.
Asher said prices looked set to go up another 15 per cent this year
Source: Daily Record; Glasgow (UK)
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