British Gas Confirms New £44 Price Hike
British Gas has confirmed that they are raising the cost of the typical fuel bill of over three and half million of their customers. Raising it by an average of £44 which will be their second fuel bill increase of the year. Due to kick in from the beginning of October, it’ll mean a typical dual fuel bill will rise to about £1,205 a year.
This most recent price hike consists of a 3.8% rise in the standard variable tariff. Following on from the previous increase of 5.5% announced in April earlier this year, which kicked in from the end of May.
In total, British gas customers on the standard variable tariff will be paying an average of £104 more for their annual energy bills. More than they were just four months ago.
British Gas Blame Wholesale Energy Prices
British Gas have laid the blame for their second increase in 2018 on the rising cost of wholesale energy, which they claim has risen by 20% since April of this year. Centrica, the company who owns British Gas, also noted the price rises made by their competitors as a factor.
The Chief Executive of Consumer Business for Centrica, Mark Hodges, said in a statement that,
“[Centrica] have today reluctantly announced plans for an increase in our standard variable tariff. We understand that any price increase adds extra pressure on customers’ household bills. However, this reflects the sharp rise in wholesale energy costs.”
It was also added that Centrica wanted their customers to switch from the increased standard variable tariffs. With 1.3 million expected to make the switch to an alternative tariff throughout the course of 2018.
Price Hike Criticised
Even if the amount of British Gas customers on the standard variable tariff does decrease from the 4.3 million at the beginning of 2018 to the projected three million by the end of the year, that will still leave millions of often vulnerable customers on the most expensive tariff.
Household budgets are already feeling an economic squeeze. With the average wage growth having slowed down to just 2.5% while inflation holds steady at 2.4%. Both of the British Gas price hikes this year have thus attracted plenty of criticism, although many experts in the field have been urging those affected to solve the problem by taking action.
How to Avoid the Price Hike
The best way to dodge the price hike is to simply get off of the standard variable tariff. Get on to a cheaper fixed rate tariff. Customers often end up on the standard variable tariff once their original fixed rate contracts come to and end. They are automatically rolled on to the new and much more expensive tariff. It is a practice that has been heavily criticised by industry watchdogs as it often ends up targeting the most vulnerable members of society, but as yet it remains legal.
It is rare that a customer for either domestic or commercial energy supply will be locked into a contract for a standard variable tariff. So it is really is as simple as weighing up the available tariff or supplier options and choosing the one that best suits your own personal or business energy needs.
If you want to learn more about the different energy supplier options and tariffs available, get in touch with Business Save’s team of highly experienced energy experts.