The supplier said the costs of the Energy Company Obligation (Eco), Feed-in Tariffs, and increased transmission and distribution costs, were behind the £28 a year increase which will come into affect from 27 May. There will be no increase to customers’ gas charges.
The average direct debit dual fuel customer can now expect to pay £1,176 per year.
In November last year, Co-operative Energy said it would “absorb the burden” of increased costs over the winter months but that it would review its prices if it “misread the signals” about the reductions to the green levies made by the government.
The supplier stated it is “still experiencing a number of increases that came into play from the start of the year” and therefore had to increase its prices.
Ramsay Dunning, group general manager at Co-operative Energy, said: “We are not increasing prices to reward financial investors.
“We are simply no longer able to absorb these government-imposed costs.”
The move comes only a couple of weeks after Ovo and First Utility both launched sub-£1,000 energy tariffs.
Tom Lyon, energy expert at Uswitch.com, said he hoped the increase by the Co-operative Energy would not put customers off switching to an independent supplier.
He added: “This comes completely out of the blue at a time when some suppliers are doing all they can to make energy more affordable.
“After a winter of rationing heat and hot water to cope with rising bills, this could be a bitter bill to swallow.”