Now British Gas has cut its standard tariff – by much less than it should
Gosh. British Gas is to cut household gas prices by five per cent – but this is a whopping 22 per cent less than the fall in wholesale gas prices.
The company says its 6.8 million customers will benefit by £37 over a year (that’s if the price cut remains for that long). It’s more than E.On customers (as reported here yesterday)…
… but the benefit of the wholesale price cut means British Gas will still make a whopping profit of more than £1 BILLION.
(Total profit is likely to be around £1,107,040,000).
British Gas representatives were all over the media this morning, apologising for making customers wait until February 27 before they feel the benefit; this is because the company reckons it bought the gas being used at the moment at higher, 2013-14, prices.
They should have been apologising for failing to pass on all of the wholesale cut to customers. It would have saved them very nearly £200 per year.
That kind of money is desperately needed by families feeling the pinch of the Conservative-planned cost of living crisis.
The drop will only benefit customers on British Gas’s standard and those Fix & Fall tariffs and the effect on different customers will vary.
The Labour Party, which has been campaigning for fairer energy bills for more than a year, has been (understandably) disparaging about this meagre display of largesse.
Shadow energy secretary Caroline Flint tweeted: “Wholesale gas prices down by [more than] 20%, yet gas bills only cut by 5%. Regulator must have power to make sure full savings go to all consumers.”
In a statement to the press, she added: “This shows that Ed Miliband was right to challenge the energy companies to cut their prices and pass on the falls in wholesale costs to consumers. But given gas prices have fallen by at least 20 per cent a price cut of just 5 per cent means consumers still aren’t getting the full benefit of falling wholesale prices.
“The next Labour government is committed to making big changes in our energy market: freezing energy prices until 2017 so that bills can fall but not rise, and giving the regulator the power to force energy companies to cut their prices – when wholesale costs fall – to all of their customers.”
Some have taken issue with the description of a freeze that allows prices to fall, rather than keeping them static, but this is nit-picking. We can all see that Labour is simply pushing for households to get the best deal.
What do the Conservatives want? What do the Liberal Democrats want? Only last week they showed…
They’re quite happy for the rich company bosses to keep your money.
Follow me on Twitter: @MidWalesMike
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not many will benefit mike as most people like myself are on a fixed tariff to prevent costs going higher. come 2016 when the contract ends you can be sure that costs will be going up again as cheep oil has always been a blip on an ever going upward spiral
Money money money it’s a rich mans world (Abba) and that’s all that concerns the Tories as ever and nothing will ever change.
… their view. But we can vote them out and have a government with a different philosophy.
Bring on May ready to celebrate counting every minute.
I hope someone somewhere (Ofgen) is making a graph that maps wholesale vs retail price of gas. So we see the curves match nicely although with a time delay. Anyone seen one?