Why are we changing our prices?
Over the last 18 months the wholesale energy market has been extremely volatile with some of the lowest and highest prices we have seen over such a short period of time.
The perfect storm of unfavourable factors means that wholesale prices continue to soar, since the beginning of the year the price of gas has, unbelievably, increased by more than 180%.
Since April last year gas prices have increased by more than 610% and with the UK’s reliance on gas fired power stations to generate electricity, wholesale electricity prices have also increased by 265%.
So, what’s causing the prices to rise?
Much of the same as the factors we highlighted in recent posts - the market is being further squeezed by the higher demand as a result of the depleted energy stocks experienced at the beginning of the year. We have stiff competition globally to replenish these stocks as countries find themselves in a similar situation to us - and that is continuing to drive up wholesale prices. Additionally, Russia has reduced the amount of gas available to buy. For more context you can access our previous market price updates.
Every energy supplier is affected by this, and you may have recently seen that Ofgem is significantly increasing the price cap this winter which will impact homes across the UK with increased energy bills.
You’re always on our best deal – and we’ll continue to be one of the cheapest in the market.
We never take the decision to increase our prices lightly. We try to consider our customers in every decision that we make, and we recognise that increasing energy bills can be difficult for many.
We’ve done everything we can to minimise this increase as much as possible. As a result, we will be £71 cheaper than the energy price cap for our typical Igloo customer.
We’ll continue to closely monitor the wholesale market to make sure our customers are always on the best deal that we can offer.
With the possibility of increased supplies coming into Europe, and the hope of an Indian summer we could potentially see wholesale prices drop. If this happens our single variable tariff allows us to have the flexibility to respond quickly and pass on these savings to all our customers.
We’re here to help
We recognise that this price rise may cause additional stresses and challenges for our customers and we’re here to offer support.