More winter blues for energy consumers

Consumer Focus have reacted with dismay to the announcement by British Gas of average price rises of 7% for both gas and electricity.

Adam Scorer, Director of External Affairs at Consumer Focus, said: ‘Consumers will be dismayed by this news. Winter is going to seem that much colder and budgets are going to be that much tighter after this announcement.

‘British Gas and other suppliers respond to forward energy prices, and that will be their argument that price rises are needed. However, wholesale prices are around half of their peak in 2008 and yet in the same period customers prices were cut by less than ten percent. Consumers will feel that suppliers didn't make cuts when conditions allowed it, but are covering their profit margins as wholesale prices nudge up. At a time when there are reports of a gas glut it seems that consumers take on all the risk in this market.

‘The bigger context for these price rises demands a new age of transparency about the price of energy. £200 billion will be spent in the next ten years to improve our energy supply and cut carbon emissions. All this will be recovered from consumer bills, which are set to rise dramatically. Consumer trust is already rock bottom in relation to energy suppliers - customers need to know whether they are getting a fair deal, but this is currently impossible.'

Consumer Focus recognises that British Gas has taken some action to protect its most vulnerable customers this winter as the price rise will not be applied to the company's 300,000 most vulnerable customers until Spring.  However the Consumer Watchdog is very concerned about the impact of the firm's wider price rises.

Consumer Focus recommends that consumers shop around to make sure they're on the cheapest payment method and best deal for their energy, as price can vary by up to £200 per year.