British Gas will increase electricity prices by 12.5% from 15 September, its owner Centrica has said, in a move that will affect 3.1 million customers. Gas prices are unchanged, but the average annual dual-fuel bill for a typical household on a standard tariff will rise by £76 to £1,120, up by 7.3%. Centrica said the rise was a result of transmission and distribution costs and the costs of government policy. But the government said its policy costs “could not explain” the rises. Centrica said the price increase was its first since November 2013, adding that British Gas was one of the last suppliers to raise prices. The company said it would protect its most “vulnerable customers” against the rise and that British Gas would credit more than 200,000 people on the government’s Warm Home Discount with £76. Centrica chief executive Iain Conn told the BBC’s Today programme that wholesale costs had gone down and were not the reason for the price rise. “We have seen our wholesale costs fall by about £36 on the typical bill since the beginning of 2014 and that is not the driver. It is transmission and distribution of electricity to the home and government policy costs that are driving our price increase.”
BBC 1st Aug 2017 read more »
Ministers faced calls to intervene on energy prices yesterday after British Gas increased bills for three million households by up to £76 a year. Action to tackle prices appeared to have stalled amid an impasse between the government and the regulator, Ofgem, over who should implement a wide-ranging price cap on standard tariffs promised by Theresa May. Britain’s biggest supplier blamed increasing costs of green energy subsidies and levies to fund power networks for a 12.5 per cent increase in standard electricity prices, adding £61 to bills. British Gas said that it was also scrapping a £15 discount offered to customers who buy both gas and electricity, so increasing their bills by a total of £76 a year from mid-September. The government said that the rise would “hit many people already on poor value tariffs” and that the costs of political policies could not explain the increase. The prime minister promised before the election to tackle “rip-off” prices by capping standard tariffs, saving 17 million households up to £100 a year. Greg Clark, the energy secretary, then passed responsibility to Ofgem, writing to the regulator in June to ask what action it would take “to safeguard customers on the poorest value tariffs”. He has said that he will wait to see what Ofgem proposes before considering other action such as legislation.
Times 2nd Aug 2017 read more »
Green taxes will cost households almost £150 from next year, British Gas has claimed as it blamed the Government for a huge rise in electricity bills for three million of its customers. Britain’s biggest supplier announced that from September electricity prices will increase by 12.5 per cent, adding £76 to the typical annual bill. The company said that the cost of green subsidies levied on bills has created “significant pressures” and suggested that it had no choice but to respond by raising prices. However the ministers last night hit back by suggesting that the price rises are unjustified as it told the regulator to do more to safeguard vulnerable customers. Government sources highlighted the fact that British Gas is also axing a £15 dual fuel discount currently enjoyed by 3.1 million of its customers from September. Ministers claimed they have not ruled out imposing an energy price cap, although the measure appeared to have been abandoned after the Tories disastrous performance in the General Election. A spokesperson for the Department for Business, Energy and Industrial Strategy (BEIS) said: “We don’t recognise these figures put out by British Gas. A number of independent reports have shown energy policy costs make up a relatively small proportion of household energy bills.
Telegraph 1st Aug 2017 read more »
British Gas lost a further 387,000 domestic customers in the first half of the year, a 3 per cent year-on-year decline, but its results were also affected by a sharp reduction in consumption in the first half owing to warmer weather during the winter and spring compared to 2016.
FT 1st Aug 2017 read more »