British Gas announces bill cuts

08/05/2009

British Gas said today that it is cutting its electricity prices by ten per cent with immediate effect.

Around 4.5 million UK customers stand to benefit from the new deal - which follows price cuts and the introduction of table-topping tariffs from rivals over recent weeks.

On average, the dual fuel British Gas customer will pay £1,194 per year for their energy - £46 less than before.

However, costs remain higher than they were prior to last year's big price hikes, with the average British Gas customer paying just £912 a year in January 2008.

The firm put up its prices by around 46 per cent last year, before beginning to cut prices a few months ago.

This is due to movements on the wholesale gas and electricity markets, where prices hit all-time highs last summer before falling sharply.

Ann Robinson, Director of Consumer Policy at uSwitch.com, said: "This cut will be some relief for those British Gas customers who are struggling to pay bills - it makes British Gas cheaper than any other electricity supplier in the UK and it also means that they've got the cheapest online plan."

Robert Hammond, energy expert for Consumer Focus, added: "This is a very disappointing announcement for consumers, particularly as it is likely to set the tone for the level of energy price cuts across the board.

"We would have expected much bigger reductions considering that wholesale gas and electricity prices are half what they were at their peak last year."

Tags; Housing Debt and Bills, Young Family Finances, Retirement Money Problems,

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