This reduction will benefit more than one million customers, with the average annual standard gas bill reducing by £32.
Neil Clitheroe, Scottish Power’s CEO of Retail and Generation, said: “Over the past year, we have tried to always offer our customers competitively priced dual fuel tariffs.
“This has encouraged more of our customers to switch between tariffs with now close to one in two on fixed price products. This is one of the highest proportions of fixed price customers of the major suppliers.”
The price-cut announced by the Glasgow-based company trumped the announcement last week by Perth-based rival SSE, which cut its gas prices by 5.3% with effect from 29 Mar 2016.
These two utility giants – who form part of Britain’s ‘Big Six’ – have come under sustained pressure from consumers and regulators to reduce their prices as the wholesale price of gas fell along with crude oil prices.
The issue of public trust in utility companies over ‘prices that rise like rockets, but fall like leaves’ has led to hundreds of thousands of consumers voting with their household meters and switching to more than two dozen independent rivals.
Meanwhile, Britain’s largest energy supplier, British Gas, has announced plans to cut around 500 jobs, the first as part of a plan by parent company Centrica to shed 6,000 posts.
Like the rest of the Big Six, Centrica is facing a tough business environment amid weak energy prices, low demand and strong competition for customers from smaller energy suppliers.