New EDF price rise hard to justify, says Ofgem

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EDF's decision to raise prices on so-called dual fuel bills by 7.2 percent on June 21 follows another increase announced in December.

The standard variable gas tariff will increase by £29, while the standard electricity tariff will increase by £49.

The supplier previously increased electricity prices by 8.4% on 1 March, although it cut gas prices in January, the BBC reported.

A second price rise in four months for EDF customers has been attacked as "difficult to justify" by the energy regulator.

According to EDF the average dual-fuel customer will now pay and extra £78 a year, this brings the annual bill to £1,160.

In justifying the latest increase, EDF Energy CEO Vincent de Rivaz said the business needs to make a "fair margin" in order to be able to "invest for the long term".

Energy utilities have said that because they buy energy on wholesale markets months in advance to lock in costs, their price rises don't necessarily reflect changes in spot prices.

The company is also launching a new three-year fixed deal for those now on variable tariffs.

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"Today's announcement will still leave EDF Energy with the lowest variable gas tariff of all major suppliers".

Ofgem chief executive Dermot Nolan said: "EDF's second price rise in four months, when there has not been a dramatic rise in wholesale energy prices since it last put up energy prices, is hard to justify".

British Gas has announced a price freeze until August.

Alex Neill, managing director of home products and services at consumer group Which?, said: "Millions are continuing to suffer due to a lack of competition in the energy market". They have also pledged to give 67,000 vulnerable customers a one-off automatic rebate of £100 each.

The announcement comes after Big Six rival SSE said it was putting up standard bills by 6.9% while E.On set out an 8.8% hike, both from the end of April.

"Energy is not a luxury, it is a necessity of life", she said, adding that "the market is not working as it should".

"Customers sitting on EDF's standard tariff should look to switch to a better deal straight away".

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