Scottish and Southern announces tariff decrease “within a few months”
For the first time in six years, gas and electricity customers at UK multi-utility Scottish and Southern Energy (SSE) have been told their tariffs will finally come down sometime “within the next few months,” according to a company spokeswoman on Wednesday.
The only unanswered questions remaining for the seven million domestic customers of SSE — who increased electricity tariffs by an average 12.2% and 9.4% respectively on 1st January 2007 (see ESGM 12.189) — are “when” and “by how much.”
“I don’t know by how much and when, but the next move is definitely down,” said the spokesman, admitting that the statement was rather vague, but nonetheless demonstrating “the company’s commitment to lowering prices.”
Prices have been falling on the wholesale gas market in the UK since the fourth quarter of 2006, when new import infrastructure from Norway and the Netherlands (Langeled and BBL) started shipping gas to the NBP and helped alleviate tight supply conditions in Britain.
Last September, when SSE announced it was increasing domestic tariffs, February ’07 gas prices were trading at 74.55 p/th, yesterday prices for the same contract had fallen by 68% to 23.70 p/th.
Alistair Phillips-Davies, SSE’s energy supply director, said in a statement: “Since last September, we have made clear our intention to cut gas and electricity prices if there was a sustained fall in wholesale prices…I am very pleased that we have now been able to do this.”
Phillip-Davies conceded that “future trends in wholesale prices are difficult to predict…but I hope we will see a downward trend in the prices paid by our customers.”
Curve prices have flattened considerably in recent months. At the end of September, Winter ’07 was trading at 58.90 p/th, and Winter ’08 at 52.70 p/th.
On Tuesday Winter ’07 was trading at 39.75 p/th, while Winter ’08 was worth 39.00 p/th. JE
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