Eon front of the queue with £117 increase as energy suppliers eye price rises

Eon has become the first energy company to jack up prices for almost 2m customers just days after Ofgem said it would let suppliers charge more for electricity and gas.

Customers on default tariffs will face bills over 10 per cent higher from the beginning of April, the company confirmed today.

Read more: Ofgem price cap: What to do if your energy bills shoot up

The prices will go up by £117, settling just by Ofgem’s new £1,254 cap, burdening customers with a £211m bill.

Consumer group Which said the rise would be a difficult pill to swallow for Eon’s customers after a recent survey showing it had among the worst customer service in the country.

“This hike in energy prices to the maximum level permitted by the price cap from April will be hard to stomach for more than a million households — particularly announced so quickly,” Which’s Alex Neill said.

However, Eon said it needed to pass on a £74 increase in the wholesale cost to provide energy to the average customer, adding it expects others in the industry to follow suit.

“Ofgem’s energy market price cap review set out that price cap levels would increase, driven by rising wholesale and other costs,” a spokesperson said.

Ofgem faced heavy criticism last week after it hiked its price cap for average-use households on a standard variable tariff to £1,254 from £1,137.

Peter Earl, head of energy at Compare the Market said: “For the past few years, consumers were hit by price increases with concerning regularity.

Read more: Households told to cough up as Ofgem raises energy price cap

“It seems the only change is that now the hikes are sanctioned by the energy regulator. This ultimately allows the energy companies to use the price cap as a deflector shield from public criticism.”

The first price cap came into force on 1 January this year.