15 December 2006
Utility group Centrica, which controls British Gas Residential Energy, has said in a statement that it will cut customer prices in the spring once it has discovered the true cost of its winter gas costs.
In addition, chief executive of Centrica, Sam Laidlaw, admitted: "We need to continue to drive cost reductions and improving customer service to ensure we are able to compete effectively in a tough market."
The pledge arrives as the official numbers of consumers who have left British Gas is announced as 978,000, or 6% of its overall UK customers, in this year to date.
About 1,300 jobs will be cut in the new year in a restructure which is hoped to boost efficiency, but many of those employees will be redeployed in customer service roles at British Gas.
Centrica will also close its headquarters in Stockley Park, Middlesex and relocate to Staines as part of the reshuffle.
In an official statement, Centrica said that a price cut for customers was expected because the "warmest autumn on record in the UK has coincided with the predicted additional supplies of gas being delivered," according to the BBC.
Centrica added that the extra supplies and a 15% decline in residential gas demand mean that "although the winter is still ahead of us, margins are improving".
"Against this background we have decided to absorb additional distribution costs of around £100 million per annum and we plan to reduce prices for our customers in the spring."
"We remain resolute in our belief that British Gas must establish reasonable and sustainable profitability to provide long-term energy security of supply while delivering value to the customer," Centrica concluded.