Domestic gas prices will be cut by four per cent and electricity prices will be nine per cent lower, the company said, starting from the end of March.

After households saw their energy bills rise by 40 per cent in the first eight months of last year, Scottish and Southern said they are now reducing their gas and electricity prices as wholesale costs have been falling steadily since July last year.

The energy provider said that its dual fuel customers will pay an average annual bill of £1,193 after the cuts, a saving of £66.

Commenting, Alistair Phillips-Davies, Energy Supply Director of SSE, said: “We know our customers want to understand what their energy is likely to cost in the future and that’s what lies behind today’s announcement.

“The UK now relies on energy imports and wholesale prices for electricity and gas are still at historically high levels. Against this background, companies need to be successful in fuel procurement, product development and customer service to deliver the best possible value for customers, and that’s what we work to deliver.”

It has taken the company three months after announcing that it was contemplating cutting its domestic fuel prices to actually bring about the change, and it got beaten to the punch by British Gas which announced several weeks ago that it is slashing its energy prices by 10 per cent.

Even after the cut, Scottish and Southern’s fuel tariffs still remain above what they were this time last year, before it raised its prices by 14 per cent.

The company has also said in a trading statement that its full year profit estimates remain unchanged, and reaffirmed its commitment to raising its dividend.

“In a period in which little can be taken for granted, the importance of profitability and dividends has been reinforced,” said Scottish and Southern Energy chief executive Ian Marchant.

The energy group also said in the statement that it is still on target to pay a full-year dividend of 66p – nine per cent more than last year. Scottish and Southern shares rose 5p this morning to £12.04.

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