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E.ON announces average dual fuel price increase of 3.7%, effective from 18th January 2014

By AndrewBarrow

• Dual fuel (variable) average increase: 3.7% (£48) ⁽¹⁾


• Electricity only (variable) average increase: 3.7% (£20) ⁽¹⁾


• Gas only (variable) average increase: 4.6% (£37) ⁽¹⁾

E.ON has today announced that from 18^th January 2014 its energy prices for existing standard variable dual fuel customers will be on average 3.7% higher.

For the second year running E.ON has announced an increase later than any other major supplier and has once again shown it is working hard to limit the impact on its customers by announcing a lower average percentage rise than any other major supplier.

Other key customer aspects:

• Simpler discounts, greater value: E.ON has changed the way it offers discounts to customers, moving from percentage to pound values. This means that even with today's price rise, around one in four E.ON customers will see lower bills than before. This is simply because the pound value is higher than the percentage discounts some customers would have seen on their bills.
  


• Price Alert: E.ON will automatically tell customers on fixed deals of new cheaper deals if / when they are offered. Customers registered online and on fixed tariffs will automatically be told (via email) of new deals which may offer better value, when they are introduced.

Commenting on today's announcement Tony Cocker, Chief Executive, E.ON UK said:

"There is no escaping the simple fact that any price rise is unwelcome news for customers. We know that, which is why we have held off for longer than most of our competitors and worked hard to keep our rise as low as possible. However, now more than ever, the help we offer our customers, in terms of advice and practical measures, is absolutely vital.

"We have moved quickly to pass on the benefits of changes announced by the Government at the beginning of this week. This means we have reduced the overall level of a rise that is necessary to cover the extra costs we are seeing in some areas, as well as making sure we continue to deliver a sustainable future for all of our employees and maintain our investment in the UK.

"Whilst there can be no guarantees, the likelihood of further price rises over the next 18 months caused by an increase in the cost of social and environmental obligations has receded due to the recent action taken by the Government."

E.ON has outlined how the change in Government environmental and social schemes will be implemented, along with many other changes to make its products simpler and more comparable.

Some of these key aspects are:

• Savings that E.ON will see as a result of the Government changes will be passed on in the simplest and fairest way:


• Customers on standard variable tariffs will see their prices change. Customers already on fixed deals will, in the majority of cases, still be on products that are lower in price than the altered tariffs.


• All electricity customers will receive the full £12 Government rebate that relates to the change in funding of the Warm Home Discount. This follows the policy set out by the Government and is the same for all suppliers.


• In addition, E.ON is launching new fixed products which will have these changes built in. Customers on existing products can switch to them without charge at any time.


• The savings that E.ON will see as a result of the alterations to environmental and social obligations will be passed on in the form of a change to the standing charges that are part of standard variable products. This means customers on standard variable tariffs will benefit from 18^th January 2014 and our new fixed products will reflect these savings.

• This was the fairest way possible to pass on the savings E.ON will see as a result of the changes and a way of maximising the savings for a huge number of our customers. It must also be remembered that all electricity customers will receive the £12 rebate, without exception.

E.ON is also changing its products to make them simpler, easier to compare and compliant with Ofgem's Retail Market Review (RMR).

Major changes include:

• Discounts - simple and fair. Now provided as a clear monetary value, not a percentage discount.
  


• From 18^th January 2014, E.ON customers can receive:


• £20 a year for having a dual fuel account


• Up to £10 a year for paperless billing (£5 per fuel)


• Up to £70 a year for paying by Fixed Monthly Direct Debit (£35 per fuel)
  
• Loyalty - rewards will be available for all of residential customers who have an electricity or dual fuel account and opt in to E.ON Reward Points. Customers will be awarded up to 1,500 E.ON Reward Points a year, which are accrued on a daily basis and awarded monthly. These points can be exchanged either for Tesco Clubcard points or Bonusbonds (vouchers for the high street).

FAQ and key details of the price rise announcement and the changes being made to move E.ON towards full Ofgem RMR compliance

Helping customers

What are you doing to help your customers save money and ensure they are on the best deal for their needs?

Over a year ago we launched our ‘Best Deal For You' online tool, now offering a set of four tariffs. Consumers can find the best E.ON deal for them by visiting www.eonenergy.com/bestdeal or by phoning 0330 400 1009.

We are committed to helping our customers use no more energy than they need so we have launched the Saving Energy Toolkit, an easy-to-use online tool which allows customers to better understand and control their energy use. The Saving Energy Toolkit shows people where their energy is being used, when they use the most and how they compare to similar nearby homes. By showing them this information we hope that our customers will feel more in control and ultimately take action to use only the energy they need.

Advice on how to save energy can also be found at www.eonenergy.com/for-your-home/saving-energy

What are you doing to help your vulnerable customers and those most in need?

For customers who are struggling to pay their bills, we can offer practical debt advice, home visits and information on funding schemes either from E.ON or third parties.

Since the Warm Home Discount came into effect on 1 April 2011, like other major suppliers we have offered rebates to our electricity customers who meet the eligibility criteria; £135 per household during 2013/2014. In 2012/13 we helped around 284,000 E.ON customers though the Core Group and Broader Group rebates with spend around £37m. New applications to this year's scheme closed on 3^rd December but E.ON expects to help significantly more customers in 2013/14.

Our Caring Energy support team can talk to customers about their individual circumstances to provide help or signpost other routes to access potential assistance.

Other initiatives to help our vulnerable customers include helping around 10,000 households (not necessarily E.ON customers) through the Age UK Industry initiative with spend around £750,000. These customers primarily benefit from a Benefit Entitlement Check with the average recipient benefiting by an increase in income of over £2,000 a year.

In addition, we've spent around £200,000 on the supplier funded industry initiatives of Energy Best Deal (run by the Citizen's Advice Bureau) and the Home Heat Helpline. Both of these services provide free advice to consumers on energy related topics.

Customers on our WarmAssist tariff will be protected from this rise and E.ON guarantees no rise for WarmAssist customers during this winter.

Products

New Ofgem rules mean you can only offer four core tariffs, what are your core four tariffs?

E.ON Energy Plan (Standard - evergreen variable)

E.ON Energy Fixed 1 Year v6

E.ON Energy Fixed 2 Year v5

E.ON Age UK Fixed 2 Year

How many customers do you have on fixed and capped tariffs?

Today we have just over one million customers on fixed deals.

Around 500,000 of these customers are on fixed deals that end more than six months after the effective date of this price change.

How much is the exit fee for customers that wish to leave your fixed tariffs?

The exit fee for most products is £5 per fuel for one-year deals and £10 per fuel for two-year deals, though some older products differ. However, E.ON customers wishing to switch to an alternative E.ON tariff will not be charged a fee. No cancellation fee is applied to our Age UK tariff.

You still have customers on other tariffs such as StayWarm and WarmAssist, are you breaking RMR rules?

No. Customers still on our StayWarm tariff will be able to stay on the product until the end of their contract, for which renewals ceased after 6^th October 2013.

For customers on WarmAssist, we requested that they are allowed to remain on this tariff if they so wish and this has been agreed with Ofgem. WarmAssist has not been open for customers to switch to since 20^th January 2012.

Migration

Do you have customers on historic tariffs which you will now move to your standard offering?

Yes. We have written to affected customers to notify them that their tariff is no longer available and that we will be moving them to our standard offering (as required). We recommend and hope customers get in touch to have 'Best Deal For You' conversations or use our on-line tool to find our best available tariff for their needs.

Which tariffs does this relate to that you no longer offer?

Customers on our Energy Online, Go Green or Age UK variable products will be moved to our standard offering but we hope to have 'Best Deal For You' conversations with them about whether there is a better or more suitable product for their needs. We will continue to offer Age UK fixed products exclusive to the over-60s.

For customers on Energy Discount we will be honouring the 3% discount below standard, until the end of their term, however terms and conditions will change.

Standing Charge

Do you charge a standing charge?

Yes. We apply a standing charge to our tariffs; this is:

£95 (around 25p a day) for electricity

£115 (around 30p a day) for gas

For customers who pay by Fixed Monthly Direct Debit we offer a reduction on the standing charge for each fuel of £35 per year.

Discounts

Do you offer a reward for paying promptly

No. This is something we no longer offer following the introduction of the new Ofgem RMR rules.

What discount did you previously offer to customers paying promptly

The prompt pay discount was previously 3% for customers paying by cash or cheque.

When was the prompt pay discount removed?

This discount is no longer available to new customers from today.

Existing customers on (or moving to) our standard product will see this discount removed from 18 January. Customers on fixed term tariffs will retain their existing discounts until their renewal date.

Do you offer a discount for customers taking both fuels?

Yes. We offer an annual discount of £20 to all customers who take both fuels. (This is accrued daily).

Do you offer a discount for customers paying by Direct Debit?

Yes. We offer a reduced standing charge to customers paying by Fixed Monthly Direct Debit. This is £35 per fuel, per year.

Do you offer a discount for customers who manage their account / bills online?

We offer a discount to customers who choose to receive paperless bills of £5 per fuel per year.

Do customers receive these discounts automatically?

Yes. These discounts are applied automatically.

How much can customers save?

If customers choose to pay by Fixed Monthly Direct Debit with paperless billing and take both fuels from E.ON, they can save a total of £100.

£20 a year for taking both fuels

£10 a year for taking paperless billing (£5 per fuel)

£70 a year for paying by Fixed Monthly Direct Debit (£35 per fuel)

Total = £100

Rewards and Loyalty

What rewards to you offer to your customers?

Customers have the capacity to earn reward points, which can be exchanged for vouchers for the high street or Tesco Clubcard points.

Customers must have an electricity or dual fuel tariff and opt in online or by phone to activate / receive these rewards.

You no longer offer the Age UK cold weather payment; will you be honouring it for this winter?

Yes. We will be honouring this payment for this winter but going forward this is something the new rules mean we're no longer able to offer.

Price Alert

Do you automatically tell customers on your fixed deals of new cheaper deals when they are offered?

Customers on fixed deals will automatically be told of new cheaper deals if / when they are offered. Customers registered online and on fixed tariffs will automatically be told (via email) of a new deals which may offer better value, when they are introduced.

Ends

1 At current Ofgem average annual consumption of 3,300 kWh unrestricted electricity and 16,500 kWh gas, across all payment methods and regions. Includes all changes to Direct Debit, prompt payment and dual fuel discounts.

Notes to editors:

• E.ON is one of the UK's leading power and gas companies - generating electricity, retailing power and gas, developing gas storage and undertaking gas and oil exploration and production. It is part of the E.ON group, one of the world's largest investor-owned power and gas companies. E.ON employs around 12,000 people in the UK and more than 72,000 worldwide;


• In the UK, E.ON supplies power and gas to around five million domestic, small and medium-sized enterprise and industrial customers. E.ON also offers innovative energy services and technologies tailored to meet its customers' needs, and is helping customers become energy efficient by encouraging them to insulate their homes, moderate their energy usage and even generate their own power;


• E.ON has been voted Britain's best energy supplier for the second year running in the uSwitch.com Customer Satisfaction Awards. The independent report and awards are published annually and are based on a YouGov poll of over 5,000 energy customers;


• E.ON discusses changes with its customers through its 28,000-strong YourSay panel and its 1,000-strong MySay employee panel, and also through conversations with consumer advocacy groups. Improvements made to date include new tools to help customers use no more energy than they need, simpler products, transparent profits, fair prices, easier contact, and the confidence to complain;


• E.ON's generation portfolio includes world-class gas-, coal- and biomass-fired power stations. E.ON is a market leader in combined heat and power (CHP), and is one of the UK's leading green generators;


• One of the many ways E.ON leads the energy industry is through its commitment to market liquidity and transparency as evidenced by its actions on the day-ahead UK power markets including the N2EX auction. E.ON was the first company to sign a gross-bidding agreement with N2EX.

Media contacts:

Victoria Blake (02476 181 304)
Andrew Barrow (02476 183 677)
Roxanne Postle (02476 195 785)
Scott Somerville (02476 183 438)

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E.ON’s Energy Action Fund Energises Merseyside

By NaomiTroy Age UK Mid Mersey, a charity set up to provide practical services for older people in Merseyside, has been awarded a grant of £2,000 from energy company E.ON, to fund a project that encourages people in the local community to use energy wisely.

The grant from E.ON means that Age UK is able to fund a project that encourages residents in the local community to think about their energy consumption and raise awareness to the various tools available to save energy. In addition, the charity will visit residents' homes to install draught proofing for the winter months.

The E.ON Energy Action Fund is part of the company's commitment to helping local communities use no more energy than they need, benefiting both individual groups and the wider community.

Mark Lunney, CEO of Age UK Mid-Merseyside, said: "The funding received from E.ON will not only have an impact on the people who are taking part in the sessions, but also their neighbours, friends and families who they will share the tips with. It's been great to have the support from E.ON for such a worthwhile cause."

Amy Cross, Senior Community Relations Executive at E.ON, said: "We're really keen to back this project as our support goes beyond the people who take part in the sessions and helps other people too. We hope this will make a big difference to local residents."

E.ON is inviting applications from local community groups, charities, schools and not for profit organisations for energy related projects focused on reducing energy use. The fund is now open for the second round of applications and will close on Friday 6th December 2013. Successful projects will receive funding from £50 to £2,000 from E.ON to power their plans for a more energy efficient future.

To find out further information on the E.ON Energy Action Fund and to view the terms and conditions for entry, visit www.eonenergy.com/energyactionfund

Ends

Notes to editors:

• E.ON is one of the UK's leading power and gas companies - generating electricity, retailing power and gas, developing gas storage and undertaking gas and oil exploration and production. It is part of the E.ON group, one of the world's largest investor-owned power and gas companies. E.ON employs around 12,000 people in the UK and more than 72,000 worldwide;


• In the UK, E.ON supplies power and gas to around five million domestic, small and medium-sized enterprise and industrial. E.ON also offers innovative energy services and technologies tailored to meet its customers' needs, and is helping customers become energy efficient by encouraging them to insulate their homes, moderate their energy usage and even generate their own power;

For more information contact:

Naomi Troy at E.ON on 02476 180 523 or naomi.troy@eonenergy.com

Local community group become more energy aware thanks to grant from E.ON

By NaomiTroy A charity set up to relieve poverty in Bolton is launching a project that encourages local residents to use energy wisely, after it was awarded a grant of £2,000 from energy company E.ON.

Mojo Trust, based in The Quest Centre, Brownlow Way, will run energy advice sessions for one hundred people in the Bolton community. The project will educate individuals on energy efficiency, promote behavioural change, and provide information on how heating systems work.

The E.ON Energy Action Fund is part of the company's commitment to helping local communities use no more energy than they need, benefitting both individual groups and the wider community.

Lisa Pollitt, from Mojo Trust, said: "The funding received from E.ON will not only have an impact on the people who are taking part in the sessions, but also their neighbours, friends and families who they will share the tips with. It's been great to have the support from E.ON on such a worthwhile cause."

Amy Cross, Senior Community Relations Executive at E.ON, said: "We're really keen to back this project as our support goes beyond the people who take part in the sessions and helps other people too. We hope this will make a big difference to local residents."

E.ON is inviting applications from local community groups, charities, schools and not for profit organisations for energy related projects focused on reducing energy use. The fund is now open for the second round of applications and will close on Friday 6th December 2013. Successful projects will receive funding from £50 to £2,000 from E.ON to power their plans for a more energy efficient future.

To find out further information on the E.ON Energy Action Fund and to view the terms and conditions for entry, visit www.eonenergy.com/energyactionfund

Ends

Notes to editors:

• E.ON is one of the UK's leading power and gas companies - generating electricity, retailing power and gas, developing gas storage and undertaking gas and oil exploration and production. It is part of the E.ON group, one of the world's largest investor-owned power and gas companies. E.ON employs around 12,000 people in the UK and more than 72,000 worldwide;


• In the UK, E.ON supplies power and gas to around five million domestic, small and medium-sized enterprise and industrial. E.ON also offers innovative energy services and technologies tailored to meet its customers' needs, and is helping customers become energy efficient by encouraging them to insulate their homes, moderate their energy usage and even generate their own power;

For more information contact:

Naomi Troy at E.ON on 02476 180 523 or naomi.troy@eonenergy.com

Energy Education set to fuel community savings

By NaomiTroy A charity set up to improve the lives of people living and working in the Coventry area is launching a project that encourages residents to use energy wisely, after it was awarded a £2,000 grant from energy company E.ON.

Working Actively to Change Hillfields Ltd (WATCH), based on Victoria Street, Hillfields, will run sessions to educate individuals on energy efficiency and promote behavioural change through leaflets and face-to-face tutorials. Energy advice will also be given during coffee mornings and drop in sessions at the community centre.

The E.ON Energy Action Fund is part of the company's commitment to helping local communities use no more energy than they need, benefitting both individual groups and the wider community.

Trisha Evans, from WATCH, said: "The funding received from E.ON will not only have an impact on the people who are taking part in the sessions, but also their neighbours, friends and families who they will share the tips with. It's been great to have the support from E.ON on such a worthwhile cause."

Amy Cross, Senior Community Relations Executive at E.ON, said: "We're really keen to support this project as our support goes beyond the people who take part in the sessions and helps the wider community too. We hope this will make a big difference to local residents."

E.ON is inviting applications from local community groups, charities, schools and not for profit organisations for energy related projects focused on reducing energy use. The fund is now open for the second round of applications and will close on

Friday 6th December 2013. Successful projects will receive funding from £50 to £2,000 from E.ON to power their plans for a more energy efficient future.

To find out further information on the E.ON Energy Action Fund and to view the terms and conditions for entry, visit www.eonenergy.com/energyactionfund

Ends

Notes to editors:

• E.ON is one of the UK's leading power and gas companies - generating electricity, retailing power and gas, developing gas storage and undertaking gas and oil exploration and production. It is part of the E.ON group, one of the world's largest investor-owned power and gas companies. E.ON employs around 12,000 people in the UK and more than 72,000 worldwide;


• In the UK, E.ON supplies power and gas to around five million domestic, small and medium-sized enterprise and industrial. E.ON also offers innovative energy services and technologies tailored to meet its customers' needs, and is helping customers become energy efficient by encouraging them to insulate their homes, moderate their energy usage and even generate their own power;

For more information contact:

Naomi Troy at E.ON on 02476 180 523 or naomi.troy@eonenergy.com

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E.ON response to DECC announcement

By ScottSomerville

E.ON UK has today provided details of the savings which will result from the proposed changes announced by the Department of Energy and Climate Change (DECC). While the company will have to take action on bills in the near future due to other rising costs, any rise will take all of these changes into account as they alleviate some of the cost pressures E.ON was facing.

Details of the proposed changes announced by the Government:

• The Government has made a number of changes: providing a rebate for Warm Homes Discount, focusing the Energy Company Obligation (ECO) scheme and squeezing network costs which together deliver a reduction in costs to customers' bills. The other environmental levies, such as the Renewables Obligation are unaffected, but the changes made in ECO will more than offset the expected rises in these items between 2013 and 2015 - so overall there will be a meaningful net reduction in environmental and social costs.


• The changes announced (if enacted) mean that the prospect of further price rises in the next 18 months due to the Government's environmental and social obligation programmes has receded. It is still the case however, that wholesale prices and network costs, which neither we nor the Government control, may rise.

What do these proposed changes mean for E.ON customers?

• E.ON has not announced a price rise since December 2012 and once again is the only major company to hold off for so long into the winter.


• The result of these changes should mean our customers will pay less next year than otherwise would have been the case. We are working through the details and will provide an update in due course.


• E.ON can also provide customers with the assurance that it doesn't expect to have to raise prices as a result of social or environmental obligations in the next 18 months.


• There remains a risk, however, that increases in network charges or wholesale energy costs for example could force a price increase but the company (E.ON) very much hopes that situation does not occur.

Commenting on the announcement made today by the Department of Energy and Climate Change (DECC) regarding changes to government programmes, Tony Cocker, Chief Executive of E.ON UK, said:

"We welcome the Government's announcement which will remove some costs from customers' bills and offer some reassurance through to 2015. It also enables more cost-effective delivery of the Energy Company Obligation. Nevertheless, we are concerned about some elements including the rules for Solid Wall Insulation which, we believe, may threaten a sustainable and growing part of the industry and exclude some households from the potential to have their homes made warmer as a result of ECO, as well as the lack of change to the Carbon Price Floor.

"Similar to last year, we have aimed to defer any increase and keep it as low as possible - and we have been able to do so partly as a result of our success in ECO. I can be absolutely clear that the changes announced by the Government and the savings they bring will be factored in to any price changes. Additionally, whilst there can be no guarantees, the likelihood of further price rises over the next 18 months caused by increases in the cost of delivering social and environmental obligations has receded today due to action taken by this Government."

Addressing some of the proposed specific changes to the Energy Company Obligation, Tony Cocker continued:

"We are proud of the efficient way we have been delivering ECO and therefore the help our colleagues have given many customers with their energy needs. At no point did we ask for a radical change to our environmental and social obligations, beyond moving their funding to general taxation as a more progressive route, and removing the administrative burdens, rather we were getting on and delivering them, as Ofgem's recently published statistics show.

"Nevertheless, we do welcome further certainty on the future of the scheme and are also pleased that some of the measures announced today help to avoid many of the issues created by changing the rules ‘half-way through the game'.

"These include so-called ‘levelisation' measures included in the proposals which mean that our customers and our company can be treated in a fair fashion with regard to the rules being changed halfway through the legally binding obligation we sought in good faith to deliver. We also understand, and hope, that the arrangements regarding trading of ECO will be addressed as part of the consultation process to allow a more workable situation, and therefore more cost-effective delivery.

"On the other hand, we are disappointed that a decision has been taken proposing a very low backstop minimum level of solid wall insulation. This change could present a significant threat to the prospect of a sustainable industry in that arena and reduces the number of customers in older, single wall properties who will benefit, many of whom would be classed as ‘vulnerable'. We note and welcome that the Government will provide new incentives for people to insulate their homes and for landlords to insulate their properties, which should help individual customers and may provide some additional support to the solid wall insulation industry.

"In the coming weeks and months we hope the Government will continue to examine areas of policy where changes can be made that would further benefit our customers, such as the Carbon Price Floor.

"This review was an opportunity to remove the Carbon Price Floor which is simply a tax and a subsidy for owners of old nuclear and hydro plant, and increases prices for almost all households and businesses in the country. We are disappointed that the opportunity has not been grasped to remove or review this element which is basically without benefit to customers or the environment. We can understand that the Chancellor needs to balance the books and so needs the tax revenue, although we would prefer if he collected it in a different way, but we don't understand why he continues to subsidise old nuclear and hydro stations, for which our parents have already paid through their taxes.

"In meeting all our obligations and responsibilities, we promise to continue to be diligent and carry out our work in an efficient and careful manner. That is what our customers expect. That is what we demand."

Ends

For more information contact:

Scott Somerville (07540 817 936)

Andrew Barrow (07515 752 759)