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Soaring Coal and Gas Costs Force ScottishPower to Announce New Energy Prices


ScottishPower was today forced to follow other energy providers and announce new energy prices for domestic customers as a result of continued increases to input costs, including coal and wholesale gas. By January this year the cost of coal, a key input for ScottishPower, had risen by 97% and wholesale gas prices had risen by 83% compared to February 20071.

From 2nd February 2008, the average customer will see a Dual Fuel increase of 14.8%.  Electricity prices will rise by an average of 14% across the UK and Gas prices will rise by 15%2.

Following the increase ScottishPower will still be cheaper for combined Gas and Electricity than British/Scottish Gas3.

Willie MacDiarmid, ScottishPower's Director of Energy Retail, said: "We have worked hard to protect our customers from these increases for as long as possible and offer consistently competitive energy prices. Our input costs are now at record levels, having increased by up to 97% since February 2007. Like other energy providers, we are now forced to pass on some of these higher costs”.
To protect its most vulnerable customers ScottishPower has announced a package of support measures:

  • Carefree Winter Rebate4: For customers on its Carefree Priority Services Register, which includes the company’s most vulnerable customers, ScottishPower will offset the impact of the increase over the winter months. This will take the form of a credit to these customers’ accounts, which will be applied from February 2008.
  • New Social Tariff5: In addition to the winter rebate, eligible customers on ScottishPower’s Priority Services Register can apply for ScottishPower’s new Carefree Plus social tariff. This package will offer eligible customers, a saving of up to £112 per annum. These customers will also have the opportunity to access free energy efficiency improvements (such as cavity wall insulation) and a Benefits Health Check to ensure they are receiving all of the income to which they are entitled. Current estimates from National Statistics suggest that up to c. £9.4bn of benefits go unclaimed each year by eligible households6.
  • Energy People Trust: All of the above will work in conjunction with the existing ScottishPower Energy People Trust, the funding for which has increased to a total of £4.3m. Since its inception in January 2006 the Trust has awarded over £3.2m to 82 projects, which have assisted over 206,000 individuals throughout Britain.
  • ScottishPower remains the only UK energy company to set standard pre-payment prices for both gas and electricity lower than standard quarterly credit prices. This ensures a good deal for some of the UK’s most vulnerable customers - with an estimated benefit to them of nearly £11 million per annum.

ScottishPower also announced the introduction of a new Fixed Price offer to shield customers from further increases until March 20117. This is the longest energy price guarantee available to customers today. Switching to the new Fixed Price deal, will protect customers from any further rises for more than 3 years. Around one million of ScottishPower's customers are already on capped or fixed price offers and will not be affected by the increase at this time.

Notes to Editors

General Notes

An average customer’s bill has been defined as;

Gas Solus: Based on an average ScottishPower domestic gas bill across Britain for a domestic customer who uses 20,500kWh of mains gas each year. Electricity Solus: Based on an average ScottishPower domestic electricity bill across Britain for a domestic customer who uses 3,300kWh of Standard Rate electricity each year. Dual Fuel: Based on an average ScottishPower Dual Fuel domestic bill across Britain for a domestic customer who uses 20,500kWh of mains gas and 3,300kWh of Standard Rate electricity each year and pays monthly by Direct Debit

Unless otherwise indicated;
- All prices correct as at 2nd February 2008.
- All figures shown include VAT at the current applicable rate of 5%.

1. Wholesale & Input Cost Increases

 Feb 2007Feb 2008Increase
Coal ($/tonne)*$68$13497%
Gas (p/therm)^30p55p83%

Electricity (£/MWh)^


Sources: ^Heren Index, *Tradition Financial Services, VAT not applicable

2. Average Annual Bills with payment Monthly by Direct Debit

BRITAINWasWill BeIncrease
Gas £525£604£79 (15%)
Electricity £322£367£45 (14%)

Dual Fuel

£836£959£123 (14.8%)

Electricity increases are averaged across Britain. Actual increase will vary by region.

3. Comparison of ScottishPower & Competitors for Combined Gas and Electricity

Comparison based on an average Dual Fuel customer as defined above. Includes prompt payment discount for customers paying quarterly. For illustration, average annual Dual Fuel bills with payment monthly by Direct Debit are shown below:

SupplierAnnual Bill: Britain
eDF Energy£965
British Gas£968

4. Carefree Winter Rebate

All customers on ScottishPower’s Carefree Priority Services Register will receive the Carefree Winter Rebate. This will be an average sum of £22 for gas and/or an average sum of £9 for electricity credited to their account from February 2008. These credits represent the difference in bill values for ScottishPower's prices prior to 2nd February 2008 to those applicable from 2nd February 2008 for an average domestic customer across Britain with a typical energy consumption pattern over the period 2nd February 2008 to 31st March 2008 inclusive. Actual credit received will vary by region. 

5. New Social Tariff (Carefree Plus)

In addition to the Carefree Winter Rebate, the Carefree Plus package is available to Carefree Register customers who are 60 years of age and over and are in receipt of one of the following social welfare benefits: Attendance Allowance, Council Tax Benefit (this does not include Single Occupancy Discount), Disability Living Allowance, Disabled Persons Tax Allowance, Child Tax Credit (where household income is less than £14,600), Housing Benefit, Income Based Jobseeker’s Allowance, Income Support, Pension Credit, Working Tax Credit (where household income is less than £14.600), Industrial Injuries Disablement Benefit (must also have  a Constant Attendance Allowance), or War Disablement Pension (must also have a Constant Attendance Allowance).  The customer must pay by any method other than Monthly Direct Debit, Standing Order and Fuel Direct.

Eligible customers applying for the Carefree Plus package will be moved to the new Carefree Plus package from April 2008. Once on the Carefree Plus package they will receive a saving of up to £52.21 for gas, £59.35 electricity credited to their account in instalments over the course of the following 12 months.

6. Unclaimed Benefit

Source: The Office for National Statistics, “Income Related Benefits Estimates of Take-Up in 2005-06”, 13th September 2007; issued on behalf of the Department for Work and Pensions.

7. New Fixed Price Package

These prices are higher than ScottishPower’s current monthly Direct Debit prices by an equivalent of £1.50 (inc VAT) for gas per month and £1.50 (inc VAT) for electricity per month. Separate terms and conditions apply.

Media Information: Simon McMillan 0141 566 4875 / 07753 622 257