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Edf Customers Face Higher Bills

Other energy suppliers are expected to raise prices in the coming months

EDF Energy has announced it is putting up gas prices by 22% and electricity prices by 17% for domestic customers.

The firm has blamed the increase, which comes into effect on 25 July, on record wholesale energy costs.

Energy companies have been widely expected to raise the costs of utility bills this summer, as wholesale prices have been rising.

EDF is the first of the major suppliers to raise prices this summer and others are expected to follow suit.

The company said it had been absorbing higher costs in recent months but it now needed to pass on costs to domestic and small business customers.

It is the second rise for EDF customers this year.

Tim Wolfenden, head of home services at price comparison website Uswitch.com, estimated that the average annual bill for dual-fuel EDF customers would rise by £200 to just over £1,200.

'Unprecedented rises'

EDF said that energy prices had increased by 70% for coal, 63% for gas, and 47% for electricity since it last increased its prices.

EDF - which has about 5.5 million UK customers - increased gas prices by 12.9% and electricity prices by 7.9% in January.

Eva Eisenschimmel, chief operating officer of EDF Energy customers branch, said the company had been doing everything it could to keep its own costs in check.

"Record world oil prices have continued to drive up wholesale gas prices. Alongside unprecedented rises in wholesale coal and electricity costs, this has impacted hugely on the cost of supplying energy to our customers," she said.

However, oil prices have started to dip again in recent weeks.

Price warnings

The move by the French company, one of the largest suppliers in the UK, is likely to prompt similar moves by the other "big six" energy companies.

The wholesale price is affected by the price of oil

It will highlight concerns over the number of people in fuel poverty - those spending more than 10% of their household income on fuel bills.

EDF said 100,000 of its most in-need customers would benefit from 15% discounts on bills as it had extended its social tariff scheme.

It also said it was supporting the concept of a targeted fuel voucher scheme this winter.

The price rises come the day after rival company Scottish and Southern warned customers it was likely to increase electricity and gas prices.

Last week a report for British Gas owner Centrica said gas bills could rise to more than £1,000 early in the next decade.

What next?

The EDF price rises were "on the cards" said Mr Wolfenden, of Uswitch, but he said that their advice was different from when prices went up on previous occasions.

He said customers should study options to cap bills, as this was not going to be the last of any price rises.

"Fixed or capped price plans could be a lifeline for those who are more vulnerable to price rises," he said.

EDF Chief Operating Officer Eva Eisenchimmel

"These plans carry a premium, but if you've never switched before you will probably still save money immediately by moving to one. However, the best fixed and capped deals are disappearing fast so consumers need to act quickly."

He said they should also embrace energy efficiency measures in the home.

Adam Scorer, of watchdog Energywatch, also said there would be more pain for consumers to come.

He called on the government to think again about its strategy on tackling fuel poverty which he described as "inadequate".

It should also speak with the European Commission to break the link between wholesale energy costs and oil prices.

Gordon Lishman, director general of Age Concern, said fuel vouchers should be introduced for the poorest pensioners, social tariffs should be made compulsory, and customers on pre-payment meters should not be charged more.

All News supplied by the BBC