SSE has become the first of the so-called 'big six' energy firms to confirm it is to raise its prices ahead of the winter months, sparking a bitter backlash among consumer groups and politicians.
The company said household gas and electricity tariffs would rise by an average 8.2% from November 15 affecting 4.4 million electricity and 2.9 million gas customers.
It is understood several of its competitors also plan to announce increases to bills later on Thursday.
SSE blamed its decision on rising costs outside its control which it said it had absorbed for months at its retail division.
It said the move would equate to a typical dual fuel customer paying £2 a week more but pledged not to increase bills again until August 2014 having last imposed a 9% increase in October 2012.
SSE says its home energy business has run at a loss during 2013
There is a north/south divide to the increased charges with customers in the South East facing hikes as high as 9.7% while many in the North and southern Scotland face a 7% rise.
Will Morris, group managing director of SSE's retail business said: "We're sorry we have to do this. We've done as much as we could to keep prices down, but the reality is that buying wholesale energy in global markets, delivering it to customers' homes, and government-imposed levies collected through bills - endorsed by all the major parties - all cost more than they did last year.
The Government was forced on the defensive when the energy minister Michael Fallon appeared to underestimate the percentage of a bill imposed on firms by Government - first giving Sky News a figure of 4% then suggesting it was just under 10%.
Mr Morris explained: "85% of a typical energy bill is made up of costs outside our direct control and these costs have increased.
"So far this year we have made a loss from supplying energy as a result of the higher costs we have been facing and continue to face.
"We understand and regret that this will add to the pressures on household budgets, but there's a lot we can do to help.
"Rising unit prices do not have to mean rising bills and there remains huge potential for customers to save money by improving further their energy efficiency," he concluded.
Labour leader Ed Miliband took to Twitter to condemn bill rises
The increases to household bills are announced at a politically sensitive time, given the debate prompted by Labour leader Ed Miliband's pledge to freeze tariffs for 20 months should his party win the next election.
After the announcement, he took to Twitter to declare that the rise demonstrated "the need to freeze bills."
His shadow energy and climate change secretary Caroline Flint added: "Hard-pressed consumers are now paying the price for David Cameron's failure to stand up to the energy companies.
"When times are tough energy companies should be helping their customers not hitting them with more price rises to boost their profits.
"That's why a Labour Government would freeze energy prices and reset Britain's energy market to stop people being ripped off."
SSE insists its home supply business is currently run at a loss and has called on politicians to help cut bills by transferring the environmental and social obligations imposed on energy firms to central government - claimig it would save consumers £110 annually in 2013 alone.
It accused policymakers over many years of failing "to highlight adequately the cost to consumers of the policies they have pursued."
Ed Davey has insisted that Government is helping cut bills
Ed Davey, energy and climate change secretary, added: "Half of an average energy bill is made up of the wholesale cost of energy.
This far outweighs the proportion of a bill that goes to help vulnerable households with their bills and to cut energy waste, and to encourage investment in the new low-carbon energy generation we need to keep the lights on.
"SSE's own figures show that wholesale price rises have contributed more than policy costs to this price increase, as a share of the bill.
"We've already taken action to help consumers this winter. Two million households will get as much as £200 off their bills under the Warm Home Discount.
230,000 homes will be warmer this year by getting energy efficiency measures installed under the element of the Energy Company Obligation.
"We're also changing energy bills by cutting the number of tariffs, making bills simpler and clearer, and getting people off poor-value dead tariffs and on to the best deal for them."
However the reaction from consumer groups was one of horror.
Ann Robinson, Director of Consumer Policy at uSwitch, said: "This is a crippling blow for consumers, who are still reeling from last winter's price hike.
"Adding a further £111 to an already sky-high energy bill will leave consumers buckling under the pressure. This will be seen by many as the final nail in the coffin for affordable energy."
"Of course the danger now is that the other big six suppliers will follow suit. This raises the spectre of yet more households forced to cut back on their heating.
"Last winter almost seven in ten households (69%) went without heating at some point to keep their energy costs down, while over a third (35%) said that cutting back on energy usage was affecting their quality of life or health."
She concluded: "This is the grim reality we face as the cost of energy spirals ever higher."
:: A special edition of Jeff Randall Live will be largely devoted to energy pricing - at 7pm on Sky News.
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