E.ON, which is writing to each affected customer, said that the average dual fuel bill will increase by 8.7 per cent, while the average electricity-only and gas-only bill will jump by 7.7 per cent and 9.4 per cent respectively. It pledged to customers in May that it would not increase bills this year.
Chief executive Tony Cocker said E.ON had held back on price hikes “for as long as we possibly could”, and that the decision had been difficult.
Rising wholesale prices, network costs and the increasing cost associated with social schemes have weighed on the energy firm. The cost of using more renewable energy has also risen, the utility firm said.
“I understand the reasons behind these increases as Britain seeks to reduce energy waste, and invest in both new lower carbon electricity sources and in new or improved gas and electricity networks,” Cocker said.
“It is vital that everyone who takes a share of energy bills explains what that money is for and justifies those rising costs to customers.”
Experts at comparison website uSwitch.com said that the average dual fuel bill with E.ON would rise to £1,370 a year from £1,260.
The consumer group added that the average household energy bill will reach an all-time high of £1,352 a year – a 23 per increase since January 2011.