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British Gas warns over higher bills

British Gas warns over higher bills

Category: Gas and electricity

Updated: 29/01/2013
First Published: 11/05/2012

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The owner of British Gas has warned that the rising wholesale costs of gas are likely to make UK household bills more expensive this year.

In a management statement, Centrica said that wholesale costs for gas are to rise by around 15% next winter compared to the last.

It added that other costs outside of its control would also rise, and are expected to add a further £50 to the cost of supplying the average household.

"The trend for retail energy costs therefore remain upwards," said Centrica.

Mark Todd of said that other energy suppliers could follow British Gas' lead.

"This is the starkest warning yet that consumers will be faced with some hefty bill increases later this year," he added.

"British Gas is the biggest energy supplier in the UK, supplying gas to almost 10 million households, so this should be taken very seriously.

"From what we are hearing, other suppliers are feeling similar pressures, so further price rises across the board are very possible."

"Historically, the most common time for suppliers to up their prices is from July until September so we could actually see price hikes much before the winter.

The news of a rise comes after British Gas announced a 5% cut in its standard tariff in January.

But the cut came after residential British Gas customers were hit by a 16% rise in gas prices and an 18% hike in electricity prices in August last year.

All of the 'Big Six' residential energy companies in the UK increased their prices last year.

British Gas – which currently boasts almost 16 million residential customers – said average domestic gas consumption for the four months to April was 1% higher than for the same period in 2011, with average domestic electricity consumption 3% lower.
These movements reflected colder than usual weather in April 2012 following mild conditions in the first quarter.

In its trading update, Centrica said it expects to deliver a £500 million reduction in costs and a 10% increase in profits for its residential business.

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