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British Gas electricity bills cut British Gas electricity bills cut
(about 1 hour later)
British Gas has cut its electricity prices by 10% - the last of the major suppliers to do so.British Gas has cut its electricity prices by 10% - the last of the major suppliers to do so.
The cut, which will come in with immediate effect, will save 4.5 million customers an average of £43 a year.The cut, which will come in with immediate effect, will save 4.5 million customers an average of £43 a year.
The company cut its gas prices, also by 10%, on 19 February this year, benefitting more than seven million households, it said.The company cut its gas prices, also by 10%, on 19 February this year, benefitting more than seven million households, it said.
The two price cuts will together save UK households an average £132 on their gas and electricity bills.The two price cuts will together save UK households an average £132 on their gas and electricity bills.
British Gas actually raised electricity prices twice last year, by a total of 26%.British Gas actually raised electricity prices twice last year, by a total of 26%.
All its electricity customers on standard tariffs - including those with pre-payment meters - will benefit from the 10% price cut.All its electricity customers on standard tariffs - including those with pre-payment meters - will benefit from the 10% price cut.
The cut was made possible by a fall in the cost of wholesale electricity.The cut was made possible by a fall in the cost of wholesale electricity.
"The price of electricity on the wholesale markets has been falling and we've always said British Gas will do what we can to lower prices when we can," Phil Bentley, British Gas managing director told BBC News."The price of electricity on the wholesale markets has been falling and we've always said British Gas will do what we can to lower prices when we can," Phil Bentley, British Gas managing director told BBC News.
"Today, British Gas customers are paying less for their electricity than they were two years ago," he said."Today, British Gas customers are paying less for their electricity than they were two years ago," he said.
Temporary cuts
Analysts say this is part of an initial round of tariff cuts by energy suppliers and predict prices could come down further later this year.
But some are warning the cuts could be temporary as the cost of wholesale electricity is expected to rise again next year.
"Prices for the period from winter 2010 onwards have either been stable or on the increase because of the expected economic recovery," said Dr Craig Lowrey, head of energy market research at the Energy Information Centre.
"Suppliers have been given some headroom to reduce retail prices in the short term," he said, but added there was a "distinct possibility" they would go up again in 18 months time.