WHY ENERGY COSTS ARE RISING, by British Gas

Why we had to put our prices up, by British Gas

Following British Gas’ recent price rise, Ian Peters, Managing Director Residential Energy at British Gas tells us he thinks energy costs must rise. We’d like to know what you think. Leave us a comment below. 

Last week, we announced that, regrettably, gas and electricity prices for British Gas customers will rise by 6% from 16 November, adding around £80 to the average annual dual fuel bill.

I know this will be unwelcome news, especially with household budgets across the country under pressure. We did not take this decision lightly.

We can’t ignore rising costs which make up most of the bill.

North Sea gas supplies are running out, and we have to pay the going rate for gas in a competitive global marketplace. Prices in the wholesale market for gas this winter are around 13% higher than those paid to secure gas for last winter.

Investment needed to maintain and upgrade the national grid and the costs of the government’s policies for a clean, energy-efficient future are all going up too.

We’ve done all we can to cut our own costs, by doing business differently and more efficiently.

Profits

I know people will wonder why British Gas can’t make less profit and absorb the rising costs.

Our profits in the second half of 2012 are expected to be around 15% lower than for the same period of 2011, and our margins after tax in 2012 will still only be 5p in the pound.- the same as 2011, and less than 2010.

It’s important we maintain this margin. Not only are we investing in energy sources needed in the future, but we’re also investing in our customers’ homes to help reduce energy they use and keep their bills under control.

Because we’re helping our customers become more energy efficient, even though prices are going up, bills don’t necessarily have to.

We spend more money than any other energy company on people who need the most help, through energy efficiency measures, account management and payment options – and we have the broadest criteria for the Warm Homes Discount, a credit of £130 on the electricity bills of customers who are elderly and most in need.

Learn more

British Gas - customer reviews, price changes and

Energy saving tips

What do you think?

Sound reasonable? Still not happy? Let us know your verdict below

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  • hacked off

    Basicaly until we start questioning our elected officials to why they are allowing this we are stuck with the rising costs of these rip off pack animals . I REMEMBER MAGGIE THATCHER AND HER VEIW ON PRIVATIZATION / COMPETITIVE TENDERING . Well we all now know the outcome with most of these foreign utility companys “yes” most are foreign and they are Bleeding the british people dry .

    What can we do , well we need someone with balls , and the goverment we have just now has none , either that or they have there snouts in the trough with the profit sharing / share holding etc . There was a lot to be said for nationalization of one of the utility companys , or better start a new one , Im sure most of us would see prices slashed when we all defect .

    We have had no wage rises for years , it costs us money to go to work with fuel prices at the pump, the cost of insurance and heating our homes . The Goverment wonders why the country has stalled .” WELL YOU BRAIN DEAD MORONS” , if people had money in there pockets that in its self would stimulate growth . But what do you expect from rich public school boys , that have never lived in the real world with real worries.

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