npower announces simpler tariffs and end of complex two-tier rate

From: npower
Published: Mon Mar 18 2013

npower has announced it is to simplify all its standard tariffs, bringing to an end the current complex two-tier tariff structure. From 1st May 2013, npower tariffs will have a single rate for each unit of energy used. Customers will also pay a fixed standing charge to cover the cost of bringing gas and electricity to their door.

Ofgem, the energy industry regulator, will be bringing new Licence Conditions into force later in the year which will mean that all energy suppliers' tariffs will have a standing charge.

Paul Massara, Group CEO, RWE npower said: "At the end of January I set out our goal to focus squarely on customers and to make the company number one in the industry for customer experience by 2015. We are responding to customers who want clear and simple energy tariffs. This announcement is the first step on the journey. We will write to our customers explaining the changes and what it means to them. Having a consistent format across all energy suppliers will help customers make the choice that is right for them.

"Getting it right for our customers is the driving force behind all that we do, now and in the future."

Some of npower's gas tariffs have seasonally weighted elements. This feature will disappear when the standing charge is introduced and npower will credit customer accounts if necessary to ensure a fair changeover. This approach has been endorsed by Consumer Focus and Ofgem has been informed.

This new structure overall reflects more closely the costs of delivering gas and electricity to customers' homes. This will mean that some lower users will end up paying a little more but the company is confident that the structure is simpler and fairer than the old npower tariffs.

The introduction of a simple standing charge is the first step in a journey which later this year will see npower reduce the number of its standard tariffs and replace them with a small number of simple tariffs that meet the new regulatory guidelines. It will be among the first of the major energy suppliers to introduce simpler tariffs for all customers on standard tariffs.

For the moment customers can stay on their existing, non-standard tariff. However the latest information suggests that new regulations will require all energy tariffs to comply with the new format during the first part of 2014.

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About npower:
npower is one of the UK's largest electricity suppliers and has 6.6 million customer accounts across the UK.

npower has been awarded platinum status in Business in the Community's CR Index and is one of 29 companies to have achieved the CommunityMark since its launch. All CommunityMark achievers have been recognised for demonstrating excellence in their holistic and strategic approach to community investment.

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Company: npower
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