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Scottish Power is to cuts its gas and electricity prices.

The energy company will cut 7.5 per cent off its gas prices and three per cent off its energy bills – affecting 5.2 million customers.

The average Scottish Power dual fuel customer paying monthly by Direct Debit will see their annual bill drop to £1,156 per year, a reduction of £54.

However, this remains 34 per cent higher than its average bill of £959 in January 2008.

Scottish Power is the fifth of the big six energy companies to cut its prices.

EDF Energy is to cut its electricity prices by an average of 8.8 per cent, and E.ON has cut its electricity prices by nine per cent from March 31st.

British Gas cut its gas prices by ten per cent on February 19th, and Scottish & Southern Energy (SSE) stated its electricity and gas prices would fall by nine per cent and four per cent respectively from March 30th.

Only Npower is left to move.

Willie MacDiarmid, ScottishPower director of energy retail, said: “We protected our customers by being the last to increase tariffs towards the end of 2008 and, following today’s announcement, ScottishPower is one of only two suppliers to implement cuts for both gas and electricity customers this year."

He added: “Although wholesale prices have fallen recently, the market remains volatile.

"Currently forward wholesale prices for gas are 46 per cent higher than in February 2007, while electricity costs have increased by 40 per cent over the same period."

Will Marples, energy expert at uSwitch.com, said: "Consumers are getting nearer to the point when they will benefit from lower wholesale energy prices, but it is taking time and price cuts so far are averaging out at 4.6 per cent or £60 - realistically these will only make a small dent in household energy bills.

"Consumers should be thinking of giving themselves a price cut today - move to dual fuel, pay by direct debit and sign up to an online plan so that you can enjoy lower prices straight away. Switching to a competitive plan could cut your energy bill by up to £350."