British Gas cuts electricity prices

These latest cuts in electricity tariffs will save customers on average £43 a year. British Gas has made the biggest reduction this time round with the other major providers, the Big Six which include ScottishPower, Scottish and Southern Energy, E.ON and RWE npower, having already made cuts in February and March. Indeed British Gas did cut its gas prices in February, but postponed cutting its electricity prices at that time.

Managing director of British Gas Phil Bentley said, in defence of the company, that they were the only provider to cut prices in winter when people needed it most. He said: " Electricity is much more evenly spread through the year – everyone’s got their computers and TVs on – and that’s not the case with gas. With gas, we cut in winter and we were the only company that did that. We’ve always said we’ll do what we can when we can.”

The fact that British Gas has made the deepest impact on prices now raises hopes of a further war between all seven major providers and even cheaper energy prices to customers.

Mr Bentley added that now a customer who bought both their gas and electricity from British Gas would now save £132 from the beginnning of the year with average bills being £1,127. This makes British Gas the cheapest UK provider for customers who pay by monthly direct debit. He added that a cut in the wholesale prices of electricity had enabled them to make the cuts in tariffs.

However, Robert Hammond of the Consumer Focus watchdog (Ofgem) said he thought that British Gas's electricity cuts had come a bit late. He commented that the company should have made much greater reductions, considering the significant drop in wholesale electricity prices. He said that a date was to be set for a long-awaited review of the wholesale market, so that price cuts are fairly passed on to customers.

Mr Hammond said that 160,000 homes who spent 10 per cent of their income on fuel had benefited from the cuts and therefore been lifted out of "fuel poverty".

Mark Todd director of Energyhelpline which advises customers on switching to cheaper providers said: "At last we have a decent double-digit price cut after the tiny reductions announced by many suppliers. British Gas now has the cheapest standard tariff for dual-fuel customers. Other suppliers will hate this and we expect them to retaliate soon with price cuts of their own.”

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