SSE To Freeze Energy Prices Until 2016

UK energy provider SSE has announced a freeze on domestic gas and electricity prices in Great Britain until at least 2016.

The freeze is the longest unconditional price guarantee ever offered by an energy company and is intended to shield SSE’s customers from rising energy costs.

By January 2016, SSE will not have increased its prices since November 2013, a period of almost 26 months. This provides peace of mind at a time when more than three quarters of people are expecting prices to go up next year, and over 80% of people are worried about energy price rises in the next two years.

In order to deliver its price freeze SSE recognises and expects that its profit margin from supplying customers with electricity and gas will be lower than it has been previously.

SSE is also announcing measures to bring down its own business costs as part of its efforts to focus on what matters to customers. Annual operational cost savings of around £100m are expected to be realised. This will include a voluntary early release programme which, it is anticipated, will lead to a reduction of around 500 jobs across the SSE group.

While its price commitment will last until at least 2016, SSE wants to work with politicians and other interested parties on longer term solutions. It has therefore written to the major political party leaders calling for energy taxes to be taken out of bills and paid for through general taxation instead. This would make energy bills cheaper and protect those less able to pay.

In addition, SSE acknowledges that more needs to be done to make the energy sector easier to understand.

Alistair Phillips-Davies, Chief Executive of SSE, said: "With today's announcements we’re recognising that delivering the lowest possible energy prices for our customers has to be central to everything we do.

"We're responding to the questions that have been asked of us with a positive agenda for customers, including the longest ever unconditional energy price freeze. To help us achieve that, we're making sure our own house is in order by streamlining and simplifying our business.

"We're doing our bit but we don't want to stop at 2016. So today we're making clear once again that we wish to work with people to find more ways of taking costs out of energy bills and, more specifically, to make sure the cost of energy taxes is paid for fairly in a way that is proportionate to people’s income and protects the vulnerable."

(CVS/CD)