UPDATE 1-Scottish Power raises gas, power prices by 7 pct

Mon Oct 15, 2012 12:31pm EDT

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LONDON Oct 15 (Reuters) - British utility Scottish Power on Monday said it will raise retail gas and electricity prices by 7 percent on average from December 3, following similar moves by rivals Centrica and RWE npower last week.

"Scottish Power has announced increases for its domestic gas and electricity prices by an average of 7 percent following a sustained rise in its costs since the company last reduced its gas prices in February this year," it said in a statement.

The move is expected to affect 2.3 million households and follows announcements on Friday by Britain's largest gas supplier British Gas, part of utility Centrica, and rival RWE npower to impose price hikes.

SSE Plc, another rival, had already warned customers their bills will rise 9 percent from Monday.

Scottish Power blamed a 34 percent rise in spending on government schemes to reduce carbon emissions and improve energy efficiency for raising bills.

Additional costs to upgrade the energy network, up 11 percent, combined with an 8 percent rise in wholesale energy prices were factored into its decision, the company said.

RWE npower and Centrica cited the same factors in raising retail prices last week, with Centrica also including the adverse impact of lower output from its North Sea gas fields.

Consumer groups condemned the latest round of price hikes warning that more households will be forced to ration energy consumption during the winter.

"Over eight in ten households rationed their energy usage last winter. This now looks set to rise and will have a detrimental impact on some people's health and well-being," said Ann Robinson, director of consumer policy at uSwitch.

Last week regulator Ofgem released a report showing that 3 percent of the UK population had gas and electricity debts last year.

"The volley of price hikes all coming in during the winter period will fuel consumer concerns about the energy market," according to Adam Scorer, director of energy at Consumer Focus.

"Every time this happens it makes it difficult for consumers to believe that price rises are driven by real supply and demand issues," Scorer added.

UK gas prices have risen 24 percent over the past two months and electricity prices have followed a similar trend, mainly due to jitters over imports from Norway and a lower supply of shipped liquefied gas.

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