British Gas owner Centrica has announced it will be putting up its electricity prices within weeks.
We take a look at how it will affect customers:
:: How much more am I likely to pay?
The cost of electricity will rise by 12.5% from the 15 September this year.
Gas prices will stay the same – but the hefty hike in the cost of power means the average household on a dual fuel tariff will see their bills go up 7.3%, or around £76.
That will bring the average annual bill for a British Gas dual fuel customer to £1,120.
:: Why is British Gas owner Centrica hiking bills?
According to British Gas, the price rise is needed to offset the fact that delivering electricity to homes is getting more expensive.
While wholesale prices – the amount British Gas itself pays for power before passing it on to customers – have largely fallen since the start of the year, the company says that rises in the cost of transmitting that electricity mean that they are currently selling power at a loss.
British Gas also points to increases in the cost of implementing “energy policy”; that is, requirements set by the Government regarding the move to renewable energies and environmental impact.
:: Is Centrica the only company increasing its bills?
At the moment, yes. But British Gas is the only one of the “Big Six” energy firms to have held off raising prices over the past winter.
British Gas has had a price freeze in place since December of last year, while SSE, E.ON, Scottish Power, EDF and npower have all hiked customers’ bills since January.
E.ON raised bills 9% in March (gas increase 4%, electricity 14%)
SSE put up bills 7% in April (No gas hike, 14.9% jump in electricity)
npower raised bills 9.8% in March (gas increase 4.8%, electricity 15%)
Scottish Power hiked bills 7.8% in March (gas increase 4.7%, electricity 10.8%)
EDF announced two price rises this year – a 1.2% hike in March and another 7.2% jump in June
A few of the smaller suppliers have also increased tariffs – First Utility raised bills 9.7% in April and Co-op Energy announced 5% increase in April.
:: I have a British Gas pre-payment meter, will I be affected?
No – the price rise won’t be applied to those customers who pay for their electricity using a pre-payment meter.
:: I don’t think I can afford this price rise – what do I do?
British Gas says it will be offering help to 200,000 of their most vulnerable customers, to alleviate the difficulties they’ll face following the price hike.
Anyone who gets their energy from British Gas and already qualifies for the Warm Home Discount will automatically have their account credited with £76 – the amount an average dual fuel bill will increase by over the next year because of the price rise.
This should mean that, for most people who receive the discount, the hike will have no effect on how much they have to pay.