npower, a leading energy provider, has announced price increases.

One of the leading UK energy providers, npower, has today (Friday 4 January) announced a rise in domestic electricity costs of 12.7% and a rise of 17.2% in gas prices for customers from 5 January.

This change in price will make the average annual price increase for electricity £64, while gas will increase an average of £95.

npower cited the ‘dramatically increasing’ costs of wholesale energy as the main reason for the price increases, and stated that the company “had been forced” to increase the prices.

Giuseppe Di Vita, Managing Director of npower’s residential business, said: “Today’s decision was not an easy one. We always try to protect our customers for as long as possible but sadly higher energy prices are a fact of life. npower is not alone in facing these higher costs, and we expect other suppliers to follow suit very shortly.

“Anyone struggling to pay their bills, regardless of the time of year, should get in touch immediately.”

energywatch, the country’s independent gas and electricity watchdog, commented in December on the speculation of companies increasing the prices of energy. Allan Asher, the company’s Chief Executive, said at the time: “Gas is abundant; there is no scarcity or shortage of gas so there should be absolutely no need for its price to rise.

“The apparent race to raise prices is in marked contrast to the industry’s failure to act when it comes to cutting the burden of bills for consumers. In the last year [2007] wholesale gas prices have fallen by 50% and while the industry enjoyed the respite, they were in no hurry to share the benefits with consumers. Suppliers waited until spring this year to pass on miserly reductions to their customers of an average 15% off gas bills and an average of 4.9% off electricity bills.”

npower is the retail arm of RWE npower, the UK’s largest electricity supplier, and provides 6.8 million customers with energy.