Tonight:
5°c
British Gas puts up bill by 35%
Robert Lea, City Correspondent30 Jul 2008
British Gas this afternoon announced a 35 per cent increase in gas bills with immediate effect.
It also said electricity bills would go up by nine per cent, adding an extra £262.80 a year to the average dual fuel customer's bill.
The news puts huge pressure on Gordon Brown as energy prices are a main driver of the current inflation crisis while consumers will be left with less money in their pocket.
Households have already been hit by food and petrol price rises this year caused by rocketing oil costs.
It is the second increase in British Gas prices this year following a rise of 15 per cent in January and comes after increases of 22 per cent for gas and 17 per cent for electricity from rival EDF last Friday.
All the other main suppliers such as Southern Electric, Eon and npower are expected to follow suit shortly. Consumer groups said it could push average fuel prices to more than 1,500 a year by Christmas.
British Gas managing director Phil Bentley said: "We very much regret that we have had to make this decision at a time when many household budgets are already under pressure. The simple fact is we have entered an era of unprecedented high world energy prices."
Mr Bentley added: "The only answer to cope with higher energy prices, I'm afraid, is for all of us to be more energy efficient."
Earlier this month, Jake Ulrich, managing director of British Gas parent company Centrica, urged customers to wear sweaters to help keep warm.
Tim Wolfenden, head of home services at eSwitch, said today's increases had taken him by surprise, adding: "It is drastic news for a huge number of consumers. These are the highest rises we have seen in gas prices in years, if not ever. We could see prices going up for the next five years."
Steve Bloomfield, national officer at Unison, said: "Customers can ill afford another round of price increases. This latest increase will still hit vulnerable groups despite temporary measures to soften the blow."
British Gas, which has 11 million customers, says it only makes £3 profit on every £100 of gas it supplies. But its sister company Centrica Energy, which produces gas from the fields of the North Sea and Irish Sea, will tomorrow report strong profits running into hundreds of millions of pounds.
Reader views (4)
Quite simply, this shows that our government and other governments should have made serious changes as to where our energy comes from years ago (solar etc) now the citizens have to suffer as the oil companies have realised this is their last innings and are trying to make as much money as possible to the expense of the rest of the world.
- George Tones, cambridge, 31/07/2008 09:47
Report abuse
The market price of natural gas has fallen by around a third since the beginning of July! I'd also be interested to know the difference in prices charged by EDF in France and the UK... common market anyone?
- Paul, London, 31/07/2008 08:41
Report abuse
People are going to comment on the discrepancy between the hundreds of millions of pounds profit and the energy price rises. I think it's very important for Centrica to be making money from each of its core businesses including supplying energy to consumers. It's crazy to expect Centrica to make a loss supplying energy and make up the losses on Centrica Energy - though it has done that in the past. What would happen once Centrica Energy's gas ran out?
- James, London, 31/07/2008 07:08
Report abuse
It seems that we should all start to treat our gas & electric the same as we do our mortgage by capping or fixing our prices.
- Nick, essex, 30/07/2008 21:56
Report abuse
