29 December 2006
British Gas, which charges the highest prices for gas and electricity in the UK market, has indicated it plans to cut gas prices 'significantly' after the winter.
According to the Evening Standard, British Gas is losing as many as 20,000 customers a week, with nearly one million changing suppliers in total over the last 12 months.
Some analysts believe British Gas will need to cut current prices by over ten per cent to win back customers, who will also have to have faith the supplier will continue to provide energy more cheaply than rivals such as npower and Powergen.
The British Gas price cut is predicted to prompt a flurry of cuts from competitors, and will pose a challenge for Southern Electric, which announced plans to increase prices by 11 per cent on average from January 1st back in September.
However, after the price cuts, the paper estimates British Gas prices will still be higher than those charged by Southern Electric by 13.5 per cent.
British Gas currently serves 16 million customers, Southern Electric 7.5 million, and npower and Powergen six million each.
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