Source - RNS
RNS Number : 3968K
Centrica PLC
10 April 2018
 

10 April 2018

British Gas default tariffs to increase due to rising wholesale energy and policy costs

·     The price of the British Gas Standard Variable Tariff (SVT) will increase on 29th May 2018 by £60 to £1161, an average 5.5% rise for a typical dual fuel customer.

·     This increase is largely due to rising wholesale and policy costs. Similar pressures were cited by Ofgem when they increased the prepayment meter cap by just over £57 on 1st April.

·     The price increase will impact 4.1 million SVT customers, with 3.7 million unaffected including those currently on fixed-term contracts, prepayment meters and vulnerable customers.

·     The British Gas SVT default tariff was withdrawn for new customers on 31st March. All existing customers on this tariff are being contacted to encourage them to choose one of our fixed-term deals.

·     British Gas has recently introduced a new default tariff. Customers who do not make an active choice when their existing fixed-term tariff ends will move onto a 12-month fixed-term default tariff, the Temporary Tariff, which will also increase by £60 to £1136 on 29th May. 

·     British Gas is continuing to launch a range of new competitive fixed-term offers for customers, offering value, convenience and choice.

The 5.5% increase, which applies to both electricity and gas, will mean a typical dual fuel domestic customer on the SVT will pay on average £60 a year more.

Wholesale gas and electricity costs and the costs of Government policies, including the smart meter roll-out and schemes to reduce carbon emissions, continue to rise. We continue to advocate that the funding of all Government policy costs should be paid for in a fairer way such as through general taxation. 

In November 2017, as part of our 14 point plan to improve the market, Centrica announced it would end its Standard Variable Tariff (SVT) for new customers and offer a choice of fixed-term competitive tariffs to encourage customers to choose the best energy deal for them. We are delivering on this commitment.

We want to see all our customers actively choosing a fixed-term tariff and in 2017 we encouraged over half a million to move off our SVT. Over 2018, we expect a further 1.3 million customers to choose to switch to one of our fixed-term tariffs. We continue to sign up thousands of customers per week to British Gas Rewards, our programme to reward loyalty and improve engagement. Offers launched so far include free energy days, tickets for entertainment venues and free boiler services. We have nearly 900,000 members signed up to date.

As previously announced we are continuing to drive down our costs and are targeting to deliver additional cost efficiencies of £20 per dual fuel customer by 2020.


Mark Hodges, Chief Executive, Centrica Consumer said:
"We fully understand that any price increase adds extra pressure on customers' household bills. This increase we are announcing today is reflective of the costs we are seeing which are beyond our control. We are not raising prices for 3.7 million customers, including those currently on fixed-term deals, on a prepayment meter or who are vulnerable.

We continue to work hard to reduce our own costs and keep our prices as low as possible. We have seen other suppliers raise prices and Ofgem increase the level of the prepayment tariff cap largely due to increasing wholesale energy and Government policy costs. Government policies, intended to transform the energy system, are important but they are putting pressure on customers' bills. We believe Government should level the playing field so the customers of all suppliers pay a fair share of energy policy costs We continue to encourage Government to consider moving these costs out of energy bills altogether and into general taxation.

We also continue to call on Ofgem to end the Standard Variable Tariff across the market which would encourage customers to proactively seek the best energy deal for them.  We've taken action to end our own SVT for new customers. We have introduced a 12-month fixed-term default Temporary Tariff for customers who don't make a choice when their existing contract comes to an end.  And we will continue to engage all our existing customers on our standard tariff at least six times a year to encourage them to switch to one of our new fixed-term deals."

Any customer concerned about their bill should contact us on 0800 048 0404 or visit www.britishgas.co.uk.

ENQUIRIES
Investors and analysts                    +44 (0)1753 494900    [email protected]
Media                                                    +44 (0)1784 843000    [email protected]
An interview with Iain Conn, Group Chief Executive is available on www.centrica.com

Notes to Editors

Standard Variable Tariff Price Increases Since December 2017

 

Our Power

£848

£939

£91

10.7%

Apr-18

iSupply

£1,014

£1,090

£76

7.5%

Mar-18

Good Energy

£1,167

£1,249

£82

7.0%

Dec-17

ENGIE

£980

£1,038

£58

5.9%

Apr-18

Pure Planet

£860

£908

£48

5.6%

Mar-18

Ofgem Prepay Cap

£1,031

£1,089

£57

5.6%

Apr-18

Ebico

£1,101

£1,161

£60

5.5%

Jan-18

British Gas post-29 May

£1,101

£1,161

£60

5.5%

May-18

Ecotricity

£1,201

£1,258

£58

4.8%

Apr-18

Igloo Energy

£845

£871

£26

3.1%

Apr-18

Bulb

£855

£878

£24

2.8%

Apr-18

E.ON

£1,123

£1,153

£30

2.7%

Apr-18

Octopus

£908

£931

£23

2.5%

Feb-18

Larger Suppliers Standard Variable Tariffs

1

OVO

526

571

 

1097

 

2

 

British Gas pre-29 May

 

550

552

1101

3

 

SSE

 

547

574

1121

4

 

Utility Warehouse

 

562

589

1125

5

 

First Utility

 

504

628

1132


 

British Gas Temporary Tariff

 

567

569

1136

6

 

EDF

 

547

594

1142

7

 

Scottish Power

 

563

594

1147

8

 

EON

 

572

581

1153

9

 

Coop

 

590

567

1158


British Gas post-29 May

580

582

1161

10

 

Npower

 

563

603

1166


 

Average exc. British Gas

 

553

589

1138

 

British Gas Product Availability

 

·      HomeEnergy fix plus cover May 19: £1055

1 year fix with boiler breakdown cover included

·      HomeEnergy fix Apr 20: £1126

2 year fix

·      HomeEnergy fix plus cover May 19

1 year fix with boiler breakdown cover included

·      HomeEnergy fix plus Warm and Cosy July 19

1 year fix combined with Hive Warm Welcome Pack

·      HomeEnergy Tracker July 19

1 year tracking a basket of competitor SVTs

·      All Online June 19

1 year online only fix

·      All Online Green June 19

1 year online only fix with green energy

·      HomeEnergy fix Apr 20

2 year fix

·      HomeEnergy fix May 19

1 year fix

 

 

Centrica plc is listed on the London Stock Exchange (CNA)

Registered Office: Millstream, Maidenhead Road, Windsor, Berkshire SL4 5GD

Registered in England & Wales number: 3033654

Legal Entity Identifier number: E26EDV109X6EEPBKVH76

ISIN number: GB00B033F229

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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