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British Gas increases gas and electricity bills | British Gas increases gas and electricity bills |
(40 minutes later) | |
British Gas, owned by Centrica, is putting up its domestic gas and electricity prices from 18 August. | |
Gas bills will rise by an average of 18% and electricity bills by an average of 16%,. | |
The change will affect nine million households with the average dual fuel customer paying an extra £190 a year. | |
The company blamed the rising wholesale cost of gas, which has gone up by 30% since last winter. | The company blamed the rising wholesale cost of gas, which has gone up by 30% since last winter. |
British Gas managing director Phil Bentley said its bills were being driven higher by the fact that the company buys 50% of its gas on the international wholesale market. | |
"We are buying in a global energy market and have to pay the market rate," he said. | "We are buying in a global energy market and have to pay the market rate," he said. |
"Rising wholesale costs is an issue facing all energy suppliers," he added. | "Rising wholesale costs is an issue facing all energy suppliers," he added. |
'Healthy profits' | |
Centrica had already warned that it was likely to raise prices this year. | |
In May, the company said its customers were not paying enough to reflect the increased cost of gas on the wholesale markets. | |
But this argument was rejected by Mike O'Connor, the chief executive of Consumer Focus. | |
"Wholesale costs have gone up but they are still around a third lower than their 2008 peak," he said. | |
"Yet in this time British Gas' prices alone have risen by around 44% on gas and 21% on electricity and suppliers have made healthy profits." | |
Spending squeeze | |
In June, Scottish Power became the first of the big-six energy suppliers to announce another set of price increases. | |
It said it would raise the cost of gas by 19% and the cost of electricity by 10% at the start of August. | |
The latest increase in energy bills, which is likely to be followed by other big energy suppliers, comes after a round of increases last winter which saw British Gas put its charges up by 7% in December. | |
"Average household bill for a dual fuel British Gas customer will now go up from £1,096 to £1,288," said the price comparison service Uswitch. | |
"In total, British Gas customers will have seen their bills shoot up by £258 or 25% within a year, taking them from £1,030 a year to £1,288," Uswitch added. | |
Richard Lloyd, of the consumers' association Which?, said the energy firm's announcement was an unwelcome move. | |
"Many people are already having to cut back on essentials because of the rising cost of living, and with energy bills rising further, this could be a cold winter for many," he said. | |
Are you a British Gas customer? Will you be affected by the increase? Are you a family concerned at rising energy costs? Send your comments using the form below. |