british gas customers

Owners of British Gas, Centrica, say the rise was a result of transmission and distribution costs, and the costs of government policy.  However, research suggests that British Gas should be cutting bills, instead of putting them up, as the wholesale cost of energy has been falling.

Centrica chief executive Iain Conn told the BBC’s Today programme that wholesale costs had gone down and were not the reason for the price rise.

‘We have seen our wholesale costs fall by about £36 on the typical bill since the beginning of 2014 and that is not the driver. It is transmission and distribution of electricity to the home and government policy costs that are driving our price increase.’

He added: ‘We are selling electricity at a loss and that is not sustainable.’

The company also said it would protect its most vunerable customers against the rise and that they would credit more than 200,000 people on the Governments Warm Home Discount with £76.

Energy regulator Ofgem’s Supply Cost Index by collective switching site the Big Deal shows that since a peak in December 2016 costs for energy companies have fallen by 9 per cent.

Centrica is expected to reveal that earnings from its residential supply arm fell by a quarter in the first half of this year after bowing to political pressure to keep bills down. The supplier was also hit by mild weather and falling customer numbers. Meanwhile, losses are expected to have deepened in the newer business areas set up to develop small-scale electricity and smart home energy ­devices.

Ofgem said last week that it will relax licensing in order to let tech firms introduce the new gas and electric tariffs which will have more control over appliances in people’s homes than traditional arrangements. Plans will reward households for turning lights off at night and heat off in the winter, letting technology firms like Google and Amazon provide energy to British Homes.

If you are a British Gas business customer and would like us to look at your current bills and see how the price increase will affect you, contact our Energy team on 01268 495555 or email