Cut prices, energy suppliers urged

Energywatch said it hoped BG's decision immediately to cut electricity tariffs by 6% and gas bills by 3% would jolt other firms "out of their lethargy".

Scottish Power and EDF Energy have yet to announce cuts, while the watchdog said the response of other firms to falling costs had been "pedestrian".

Director of campaigns Adam Scorer said: "Lower wholesale prices give the green light to all suppliers to undercut each others' prices and really compete for customers. They have no excuse for doing nothing."

The British Gas cuts are equivalent to £40 a year for a customer with a typical dual-fuel account, meaning the average annual bill is down £207 this year. BG said it had won 678,000 new customers since cutting prices in March, when gas charges came down by 17% and electricity by 11%.

Managing director Phil Bentley said: "Our two price cuts within the space of seven weeks will mean annual savings of £207 for our customers - while some of our competitors have failed to cut prices even once."

The first round of price cuts from BG owner Centrica prompted price cuts from rivals npower, Powergen, and Scottish & Southern Energy. But Scottish Power and EDF still have their prices under review, leading regulator Ofgem to call this week for customers to consider switching.

Ofgem chief executive Alistair Buchanan said the announcement was proof that competition was working in the energy market. He added: "Customers are firmly in the driving seat and over 600,000 switched in the first two months of this year alone.

"Customers should continue to turn up the heat on energy suppliers by taking advantage of the savings available by switching supplier - around £100 if you have not already switched."

The move comes days after it emerged that complaints against British Gas had almost trebled over the past year. Most of the problems related to the introduction of a new billing system, which BG said it was working to improve.