First Utility has announced it is raising its prices by an average of 5.9 per cent for dual fuel customers on its standard variable tariff, starting on 23 July.
The typical annual energy bill will swell by £67 – or £5.58 per month – to £1,199.
The supplier, which was bought by oil giant Shell towards the end of last year, said the price hike is primarily due to a 30 per cent increase in policy costs, such as low-carbon subsidies, over the past 12 months.
It said wholesale gas and electricity prices also grew by 9.2 per cent during the period, although network costs fell by 1 per cent.
The overall effect was a 9.2 per cent increase in its total external costs per dual fuel customer. The company will absorb a 3.3 per cent cost increase itself but pass the rest on to consumers.
First Utility chief commercial officer Ed Kamm said: “We’ve always stood for fair and responsible pricing. That means passing on savings to customers when costs drop, but it also unfortunately means we need to increase prices when our costs rise.
“We’ve seen external costs increase by 9 per cent over the past 12 months and, while we have absorbed much of these, we regrettably need to change the price of our variable tariff as a result. The vast majority of our customers will not be affected.”
A fifth of its customers are on its standard variable tariff.
Earlier this week, fellow challenger supplier Bulb announced a 5.1 per cent increase in its variable tariff – the only one it has. All of the big six have announced price hikes this year.