British Gas to increase electricity, gas prices

July 10, 2011

British-based utility company, which holds ownership of British Gas, has announced its intentions to increase the prices of domestic electricity and gas later this year. On August 18, 2011, the company plans to raise the costs of gas and electrical supplies by eighteen and sixteen per cent, respectively. According to, nine million customers will be affected by these changes.

British price comparison website uSwitch has reported that the "[a]verage household bill for a dual fuel British Gas customer will now go up from 1,096 to £1,288". Mike O'Connor, the of consumer organisation, has claimed that the announcement "will send a shock wave across the country" and will place an increasing amount of difficulties "on stretched household budgets. Consumers [...] rightly question whether prices are fair."

Phil Bentley, a managing director for British Gas, has claimed that value increases like this are "an issue facing all energy suppliers". A director for British Gas, named Ian Peters, has claimed that "a fair return" will be made after the changes occur.

In 2010, British Gas experienced its largest ever profit, making £742 million (1,192 million, 835 million). Meanwhile, Centrica achieved £2.4 billion (US$3.8 billion, €2.7 billion) in profits. Richard Lloyd from product sampling charity criticised the decision to raise prices, calling the declaration "unwelcome but unsurprising" for British Gas consumers.

Previously in December 2010, British Gas increased the price of its gas by 6.9%, which equates to £43 (US$69, €48). At the same time, the company's electricity prices were raised by 6.7%, or £28 (US$45, €32). On Friday, Chris Huhne, the secretary of the, said that British electricity businesses must modify themselves so as to avoid "the cycle of fossil fuel addiction. Alternatives like renewables and nuclear power must be allowed to become the dominant component of our energy mix," said Huhne.

This news comes to light as, a rival energy company to British Gas, announced last month their intentions to up the prices of their electricity and gas supplies by ten and nineteen per cent respectively.