British Gas has announced a 12.5% increase in its standard tariff electricity prices pushing up energy costs for 3.1 million households. What will British Gas be doing for those affected by the increase?
British Gas announced today that it will raise its electricity prices by 12.5% from 15 September. This move will push energy costs up for many of its 3.1 million customers on its standard tariff.
This increase brings the total cost for a typical household on a standard tariff to £1,120 per year.
Is it any wonder that hard-pressed consumers will be hugely disappointed to see prices rise again? No. These same customers have been waiting for the government and energy industry to tackle costly standard variable tariffs (SVTs) and instead they have seen their bills go up again.
A year of discontent
While this is the first price increase British Gas have announced in almost four years, it makes them the last of the Big Six to announce its price increases. In February both nPower and Scottish Power pushed up prices which we described as a ‘bitter pill’ and ‘shocking’. In March, SSE and E.On caused outrage when they pushed up their prices. EDF followed in April with its disappointing hike in prices. That disappointment in the energy industry grows today.
After two years of investigation into the energy market by the Competition and Markets Authority, Ofgem (seeking to implement remedies to tackle the problems in the market), and the Government (committing to ensure markets work for consumers and to reduce energy bills), nothing substantive has happened to bring down prices.
Time to engage customers
In November last year we asked energy companies to send us their plans for how they will ensure their customers stuck on poor value deals are moved. British Gas responded to this with its intention to contact those on its standard tariff.
Despite all the debate we are still in the same situation and the industry’s response has been inadequate
Given it was just over six months ago since suppliers outlined their plans to engage with customers on SVTs, we’d like to know what progress they have made in reaching out to the millions of people affected by prices rises, and what they are doing to help them all to get onto better deals? As a customer, will this news encourage you to switch or stay with British Gas?
However, in today’s announcement, British Gas did refer to engaging SVT customers. The supplier stated that it has submitted proposals to the Ofgem to phase out the standard variable tariff and ‘level the playing field so that all suppliers contribute to the Warm Home Discount”.
We all agree that this market is not working for consumers. The Government needs to urgently look at what it does to help customers that are paying over the odds. The discussion needs to end and we need to see definitive action.