British Gas is raising electricity prices for 3.1 million of its UK customers by 12.5% from September. British Gas owner Centrica announced the price hike on Tuesday, the first rise in electricity prices since November 2013. The company accidentally leaked the plans on its own website on Monday evening.
The hike follows a price freeze announced in February that British Gas said would last until August. British Gas said the increase will add £76 to the typical annual bill of a household on its dual fuel standard tariff, taking it to £1,120. However, customers can fix their energy price until August 2019 on a specially discounted deal, Home Energy Secure, which will cost £1,107 per year, British Gas says.
While 3.1 million customers will be hit by the price rise, British Gas says 5.3 million people will be unaffected. 200,000 vulnerable customers are being protected from the increase.
The price hike “reflects the increasing costs of energy policy, and delivery to customers’ homes since 2014,” British Gas says in a statement. “In that time, overall electricity costs have increased by 16%.”
The price rise may draw criticism from the government. Theresa May attacked Npower’s planned 15% price hike as “shocking” earlier this year and announced plans for an energy price cap in May.
Centrica Consumer CEO Mark Hodges says in a statement: “We held off increasing prices for many months longer than most suppliers in order to protect our customers from rising costs, so it is a difficult decision to have to announce an increase in electricity prices. This rise reflects an underlying increase in policy and transmission costs.”
Centrica Consumer also on Tuesday reported a 20% fall in operating profit in the first half of the year “predominantly reflecting the impact of warmer weather on consumption in UK Home and a reduction in the number of energy supply and services accounts.” Group revenue was up 7% to £14.3 billion and adjusted operating profit was down 4% to £816 million.
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