* Follows Centrica, SSE price hikes
* Other suppliers expected to follow suit
* Opposition leader has said he would freeze prices
LONDON, Oct 21 British energy supplier RWE
npower raised its household electricity and gas
charges by an average of 10.4 percent on Monday, the third
company to hike prices as a political row over the rising cost
of living intensifies.
The leader of the opposition Labour Party, Ed Miliband, put
rising energy bills at the heart of his campaign for the 2015
election last month when he said he would freeze prices for 20
months if his party wins power.
The price hike by RWE npower - almost four times the rate of
inflation - will take effect on Dec.1. It is higher than rises
announced by Centrica and SSE, who were the
first of Britain's "big six" energy suppliers to lift their
charges earlier this month.
Centrica raised its household electricity and gas by an
average price of 9.2 percent while SSE announced an 8.2 percent
The remaining three suppliers which make up the big six,
Iberdrola's Scottish Power, EDF Energy and
Eon, are expected to follow suit, with analysts saying they all
face the same cost increases.
The RWE npower price hike will add 137 pounds to the average
annual bill for customers taking both gas and electricity,
pushing charges up to 1,459 pounds a year, the supplier said.
It was announced as Britain's energy strategy comes under
The government on Monday signed a 16 billion pound ($25.90
billion) deal with France's EDF to build the country's first new
nuclear power station for over 20 years, agreeing to fix the
price which the company will receive for the power at more than
twice current market levels.
Critics say that freezing the power price for a nuclear
plant for decades ahead could cause consumer bills to rise, a
charge denied by the coalition government.
Npower blamed its hike on the rise in the price of the raw
materials used to generate energy, the cost of fulfilling
government social and environmental schemes and of using and
maintaining the network which delivers power to homes, echoing
the reasons cited by SSE and Centrica for their rises.
"We only aim to make around 5 pence in every pound in our
retail business which we feel is a fair return for delivering
reliable energy to consumers and for the risks that we bear,"
RWE npower Chief Executive Paul Massara said in a statement.
Energy prices in Britain have already risen by 24 percent
over the last four years, according to regulator Ofgem, ramping
up pressure on household finances at a time of wage stagnation,
and prompting Miliband to make his price freeze pledge.
RWE npower criticised Labour's proposals. "Only 16 per cent
of the bill is under our control and imposing price controls
discourages investment, increases uncertainty and ultimately
leads to higher prices," Massara said.
The company's electricity prices will rise by an average of
9.3 percent and its gas prices by 11.1 percent.