OVO Energy responds to wholesale price rises but remains cheapest fixed deal in the market
By OVO Energy Friday 20 August 2010
OVO Energy today – Saturday 21 August - announced that the price of its New Energy and Green Energy fixed tariff has increased.
The move will see the average household’s gas and electricity bill rise from £921 to £945 a year. Yet, compared with the next cheapest fixed standard tariff on the market of £1055*, OVO’s new rate still saves customers a significant amount (£110).
The price change only applies to new customers. Existing fixed deal customers will not be affected.
The new rates reflect movements in wholesale prices over the last number of months. From March this year, the cost of gas has risen from 38p per Therm to 47p per Therm today, with electricity rising from 38p per kilowatt hour (kWh) to 44p per kWh over the same period.
OVO’s standard variable rate for its New Energy and Green Energy plans will also go up, although not until 1 October. At an average price of £955 for the year, the new rate remains competitive with other suppliers’.
Customers coming to the end of their one year fixed contract who decide not to fix again and instead move onto the variable rate - or who delay taking action and therefore automatically slip onto the variable tariff - will still make a saving. Their average bill for the year will drop from £978; a saving of £23.
Only the small number of customers who signed up to the previous variable rate - which was available for a limited period of time last March, allowing customers to take advantage of a drop in wholesale prices - will see their bills go up.
Stephen Fitzpatrick, OVO’s Managing Director, said: “It’s our policy to always offer customers the lowest prices we possibly can. As a business, we have to respond to trends in the wholesale market. But – despite a considerable increase in wholesale costs over the last few months – we’re really pleased to still have the cheapest standard fixed deal on the market.”