British Gas has today announced that it is putting its prices up by seven per cent or £53 for gas and seven per cent or £29 for electricity from 10th December, an increase that will hit its standard tariffs, affecting 8 million customers.
According to the impartial comparison and switching service
uSwitch.com, it will add an extra £82 on to the average annual British Gas standard dual fuel bill, which will increase from £1,157 to £1,239 as a result.
uSwitch.com says the move is a bitter blow to consumers, who now face a bleak winter with Britain's biggest two energy suppliers now having announced a December price hike. Britain's second largest energy supplier, SSE, said it was hiking gas prices by 9.4 per cent or £67 from 1st December.
With British Gas now following suit, a full-scale increase in energy prices could be on the cards, although EDF Energy has already reassured its customers by announcing a winter price freeze on standard tariffs until March 2011.
Other suppliers are yet to signal their intentions.
The last year British consumers saw a general hike in energy prices was 2008, a painful year when household energy prices rocketed by 42 per cent or £381, taking the average household energy bill from £912 a year to what uSwitch.com describes as a “wallet busting” £1,293.
Price cuts in 2009 and 2010 averaged out at just 8 per cent or £99 in total, leaving the average household energy bill still £283 or 31 per cent higher than in January 2008.
uSwitch.com says that with today's news, these reductions are in danger of being wiped back out again.
"The spectre of inflation-busting energy price hikes is back with a bang,” said Ann Robinson, Director of Consumer Policy at
uSwitch.com.
“After a two year lull, household energy prices are about to resume their steady climb upwards again. Unfortunately for consumers, the eight per cent or £99 reduction seen over the last two years failed miserably to reverse the impact of the 42 per cent or £381 increase seen in 2008.
“And now, whatever small benefit was seen is about to be wiped back out again. This will be cold comfort indeed to British consumers who are now facing an extremely bleak winter.
"There is no room for complacency and I would urge consumers to act now. There are two key steps to keeping a lid on your energy bills - use less energy by making your home more energy efficient and move to a competitive energy plan so that you pay less for the energy you do use.
“The difference between the cheapest energy plan in the market and the most expensive standard plan is £422 - this is a substantial saving and could make a real difference for those who are worried or struggling with bills.
"For those who would prefer to be protected from price hikes, now is the time to start looking at suppliers' fixed price energy plans.
“These usually carry a premium for the peace of mind they offer but, interestingly, once British Gas and SSE's new prices kick-in it would now actually be cheaper for many standard customers currently paying by cash or cheque to move to a fixed price plan."
Commenting on British Gas’ impending price hike, Lisa Greenfield, energy analyst at
Confused.com, said: "British Gas has always led the market whether it's price increases or price decreases and it's doing it again now. This latest move will increase bills by around £1.50 per week [£78 a year] and will affect around eight million customers.
“This is a sign of things to come and we recommend anyone who wishes to protect themselves from further rises or prefers to know exactly what they will be paying when the bills come in, to fix now.
"Confused.com has been warning customers for months that prices will rise and we expect this trend to continue. British Gas state the 25 per cent increase in wholesale costs of gas, network charges and environmental obligations are behind the move, and we expect other energy suppliers to follow.
“With budgets already squeezed, this is another blow to hard-up households so it's important they keep the bills as low as possible by becoming more energy efficient and shopping around regularly to ensure they're on the best deal."
Average bill sizes:
|
Supplier
|
Current bill size
|
New bill size
|
|
British Gas
|
£1,157
|
£1,239
|
|
EDF Energy
|
£1,167
|
£1,167
|
|
E.ON
|
£1,187
|
£1,187
|
|
npower
|
£1,196
|
£1,196
|
|
SSE
|
£1,159
|
£1,226
|
|
ScottishPower
|
£1,305
|
£1,305
|
|
Average
|
£1,195
|
£1,220
|
Source: uSwitch.com
Based on a medium user consuming 3,300kWh electricity and 20,500kWh gas a year on a standard plan paying on receipt of bill with bill sizes averaged across all regions.
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