TIDMCNA
RNS Number : 3968K
Centrica PLC
10 April 2018
10 April 2018
British Gas default tariffs to increase due to rising wholesale
energy and policy costs
-- The price of the British Gas Standard Variable Tariff (SVT)
will increase on 29(th) May 2018 by GBP60 to GBP1161, an average
5.5% rise for a typical dual fuel customer.
-- This increase is largely due to rising wholesale and policy
costs. Similar pressures were cited by Ofgem when they increased
the prepayment meter cap by just over GBP57 on 1(st) April.
-- The price increase will impact 4.1 million SVT customers,
with 3.7 million unaffected including those currently on fixed-term
contracts, prepayment meters and vulnerable customers.
-- The British Gas SVT default tariff was withdrawn for new
customers on 31(st) March. All existing customers on this tariff
are being contacted to encourage them to choose one of our
fixed-term deals.
-- British Gas has recently introduced a new default tariff.
Customers who do not make an active choice when their existing
fixed-term tariff ends will move onto a 12-month fixed-term default
tariff, the Temporary Tariff, which will also increase by GBP60 to
GBP1136 on 29(th) May.
-- British Gas is continuing to launch a range of new
competitive fixed-term offers for customers, offering value,
convenience and choice.
The 5.5% increase, which applies to both electricity and gas,
will mean a typical dual fuel domestic customer on the SVT will pay
on average GBP60 a year more.
Wholesale gas and electricity costs and the costs of Government
policies, including the smart meter roll-out and schemes to reduce
carbon emissions, continue to rise. We continue to advocate that
the funding of all Government policy costs should be paid for in a
fairer way such as through general taxation.
In November 2017, as part of our 14 point plan to improve the
market, Centrica announced it would end its Standard Variable
Tariff (SVT) for new customers and offer a choice of fixed-term
competitive tariffs to encourage customers to choose the best
energy deal for them. We are delivering on this commitment.
We want to see all our customers actively choosing a fixed-term
tariff and in 2017 we encouraged over half a million to move off
our SVT. Over 2018, we expect a further 1.3 million customers to
choose to switch to one of our fixed-term tariffs. We continue to
sign up thousands of customers per week to British Gas Rewards, our
programme to reward loyalty and improve engagement. Offers launched
so far include free energy days, tickets for entertainment venues
and free boiler services. We have nearly 900,000 members signed up
to date.
As previously announced we are continuing to drive down our
costs and are targeting to deliver additional cost efficiencies of
GBP20 per dual fuel customer by 2020.
Mark Hodges, Chief Executive, Centrica Consumer said:
"We fully understand that any price increase adds extra pressure
on customers' household bills. This increase we are announcing
today is reflective of the costs we are seeing which are beyond our
control. We are not raising prices for 3.7 million customers,
including those currently on fixed-term deals, on a prepayment
meter or who are vulnerable.
We continue to work hard to reduce our own costs and keep our
prices as low as possible. We have seen other suppliers raise
prices and Ofgem increase the level of the prepayment tariff cap
largely due to increasing wholesale energy and Government policy
costs. Government policies, intended to transform the energy
system, are important but they are putting pressure on customers'
bills. We believe Government should level the playing field so the
customers of all suppliers pay a fair share of energy policy costs
We continue to encourage Government to consider moving these costs
out of energy bills altogether and into general taxation.
We also continue to call on Ofgem to end the Standard Variable
Tariff across the market which would encourage customers to
proactively seek the best energy deal for them. We've taken action
to end our own SVT for new customers. We have introduced a 12-month
fixed-term default Temporary Tariff for customers who don't make a
choice when their existing contract comes to an end. And we will
continue to engage all our existing customers on our standard
tariff at least six times a year to encourage them to switch to one
of our new fixed-term deals."
Any customer concerned about their bill should contact us on
0800 048 0404 or visit www.britishgas.co.uk.
ENQUIRIES
Investors and analysts +44 (0)1753 494900 ir@centrica.com
Media +44 (0)1784 843000 media@centrica.com
An interview with Iain Conn, Group Chief Executive is available
on www.centrica.com
Notes to Editors
Standard Variable Tariff Price Increases Since December 2017
Our GBP848 GBP939 GBP91 10.7% Apr-18
Power
iSupply GBP1,014 GBP1,090 GBP76 7.5% Mar-18
Good GBP1,167 GBP1,249 GBP82 7.0% Dec-17
Energy
ENGIE GBP980 GBP1,038 GBP58 5.9% Apr-18
Pure GBP860 GBP908 GBP48 5.6% Mar-18
Planet
Ofgem GBP1,031 GBP1,089 GBP57 5.6% Apr-18
Prepay
Cap
Ebico GBP1,101 GBP1,161 GBP60 5.5% Jan-18
British GBP1,101 GBP1,161 GBP60 5.5% May-18
Gas
post-29
May
Ecotricity GBP1,201 GBP1,258 GBP58 4.8% Apr-18
Igloo GBP845 GBP871 GBP26 3.1% Apr-18
Energy
Bulb GBP855 GBP878 GBP24 2.8% Apr-18
E.ON GBP1,123 GBP1,153 GBP30 2.7% Apr-18
Octopus GBP908 GBP931 GBP23 2.5% Feb-18
Larger Suppliers Standard Variable Tariffs
1 OVO 526 571 1097
British Gas
2 pre-29 May 550 552 1101
3 SSE 547 574 1121
4 Utility Warehouse 562 589 1125
5 First Utility 504 628 1132
British Gas
Temporary
Tariff 567 569 1136
6 EDF 547 594 1142
7 Scottish Power 563 594 1147
8 EON 572 581 1153
9 Coop 590 567 1158
British Gas
post-29 May 580 582 1161
10 Npower 563 603 1166
Average exc.
British Gas 553 589 1138
British Gas Product Availability
* HomeEnergy fix plus cover May 19: GBP1055 * HomeEnergy fix plus cover May 19
o 1 year fix with boiler o 1 year fix with boiler
breakdown cover included breakdown cover included
* HomeEnergy fix Apr 20: GBP1126 * HomeEnergy fix plus Warm and Cosy July 19
o 2 year fix o 1 year fix combined
with Hive Warm Welcome
Pack
* HomeEnergy Tracker July 19
o 1 year tracking a basket
of competitor SVTs
* All Online June 19
o 1 year online only
fix
* All Online Green June 19
o 1 year online only
fix with green energy
* HomeEnergy fix Apr 20
o 2 year fix
* HomeEnergy fix May 19
o 1 year fix
Centrica plc is listed on the London Stock Exchange (CNA)
Registered Office: Millstream, Maidenhead Road, Windsor,
Berkshire SL4 5GD
Registered in England & Wales number: 3033654
Legal Entity Identifier number: E26EDV109X6EEPBKVH76
ISIN number: GB00B033F229
This information is provided by RNS
The company news service from the London Stock Exchange
END
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