E.ON freeze energy prices until the end of 2012

The cost of energy is steadily going up, and that comes as a surprise to hardly anyone. However, the competition for customers amongst the six major energy companies in the UK might ease some of the pain for the average householder. E.ON is the only one of the ‘Big Six’ to announce a cost-freeze for residential customers through the end of 2012, though analysts have noted that the start of 2013 could produce a nasty jolt for those same customers.

All of the big energy suppliers have made some cost cuts during the first three months of this year, on average about 5%, but those reductions followed an increase of up to 19% by the end of 2011. Tony Cocker, E.ON’s chief executive for the UK, said that while global energy prices are definitely on the rise, his company believes that in fairness to customers prices should be lowered whenever feasible and only raised when absolutely necessary.

E.On’s announcement of a hold on tariffs comes at about the same time the owner of British Gas, Centrica, made the announcement that energy costs are likely to go up by 15% next winter, with another increase of around £50 per customer due to rising wholesale costs, increased transportation costs and green taxes.

Richard Lloyd, executive director of consumer advocate Which? noted that the biggest financial worry for many people is the rising cost of energy, particularly when it comes to basic necessities like heating their homes and bath water, and any reassurance of stability is a good thing. Audrey Gallacher, of Consumer Focus, noted that the perception of most consumers is that companies are quick to pass on any price increase to their customers, but stingy about passing on savings when prices fall.