Energy News

British Gas hints at price increases

Wednesday 29 June, 2011

By Martin Fagan - news@consumerchoices.co.uk

Centrica chief tells MPs British Gas could announce energy price rises in “the next few weeks”.

British Gas, one of the “big six” energy companies, is expected to announce a price rise within weeks, admitted one of its key executives.

Speaking to the Parliamentary Energy Select Committee, British Gas’ chief operating officer Ian Peters said British Gas could no longer absorb wholesale energy prices and would have to pass them on to consumers.

“Unless there is a fundamental shift in the way the commodity markets are going to play out in the next few weeks then, on the balance of probability, we will reluctantly put the price up,” Peters told MPs.

“But I'm not going to get drawn into precisely when or how,” he added.

The hint of a price increase came on the same day British Gas’ parent company Centrica announced that corporate earnings for the first half of 2011 would be lower than in 2010.

Fears of price rises have increased in recent weeks following confirmation from the regulator, Ofgem, that wholesale energy prices had gone up 30% since December.

On 7 June, ScottishPower announced a price rise of 19% for gas and a 10% for electricity, which will take effect from 1 August this year.

Since the announcement, 59% of those switching their energy supplier - 205,000 households a month - are choosing a fixed price energy tariff, according to data from, uSwitch.com.

“The debate is no longer about what is going to happen to energy prices - it's now about what action consumers intend to take,” said Tom Lyon, energy expert at uSwitch.com.

“The spectre of energy bills potentially hitting almost £1,400 a year is just too big to ignore. As a result, we are seeing a surge in the number of people looking to protect themselves by fixing their energy prices.”