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| British Gas and EDF cut gas prices by £31 a year | British Gas and EDF cut gas prices by £31 a year |
| (about 5 hours later) | |
| British Gas and France’s EDF have cut their gas prices by £31 a year. | British Gas and France’s EDF have cut their gas prices by £31 a year. |
| They are the last of the UK’s big six energy companies to reduce tariffs after a collapse in wholesale commodity costs. But consumer experts described the reductions as “paltry”. They highlighted the fact that the reductions only kick in next month, at the end of the winter, and that electricity tariffs had been left unchanged. | |
| The price cut from British Gas, owned by Centrica, takes effect on 16 March, bringing 6.8 million customers an average saving of £31. The cut will not apply to older fixed tariffs that are no longer on sale, but the firm said customers can switch without charge to one of the current tariffs. | The price cut from British Gas, owned by Centrica, takes effect on 16 March, bringing 6.8 million customers an average saving of £31. The cut will not apply to older fixed tariffs that are no longer on sale, but the firm said customers can switch without charge to one of the current tariffs. |
| EDF is to cut its gas prices by 5% from 24 March, which will mean a £31 saving for 900,000 customers. The other big energy companies – E.ON, SSE, Scottish Power and npower – have also cut tariffs in recent weeks by just over 5%. | EDF is to cut its gas prices by 5% from 24 March, which will mean a £31 saving for 900,000 customers. The other big energy companies – E.ON, SSE, Scottish Power and npower – have also cut tariffs in recent weeks by just over 5%. |
| Amber Rudd, the energy secretary, said: “On behalf of the families and businesses paying the bills, I’ve spoken to bosses at the big six recently to make crystal clear that the government expects suppliers to pass on cost reductions to consumers. Six major suppliers have now announced cuts in their tariffs – it’s a good start but there’s more to do. | |
| “That’s why it’s right that the CMA [Competition and Markets Authority] is investigating to make sure that consumers are getting a fair deal, not a rough deal, on their energy. We continue to watch suppliers like a hawk.” | |
| The CMA is investigating the energy market but has delayed its provisional report on remedies to March. | |
| Martin Lewis of MoneySavingExpert.com said the price cuts gave people the “false sense of security that they’re getting a reasonable deal, yet these amounts are paltry and trivial – a reduction of about £30 on the typical bill, nothing close to the drop in wholesale prices”. | |
| The Citizens Advice chief executive, Gillian Guy, said: “For too long, people have been missing out on the benefits of falling wholesale prices. The price cuts announced by British Gas and EDF Energy will help to bring people’s bills down, but they will have to wait until March before it comes into effect.” | |
| Ofgem, the energy regulator, advised households to save even more money by switching. Rachel Fletcher, Ofgem’s senior partner for consumers and competition, said: “These price cuts are a movement in the right direction for loyal customers, but they are dwarfed by the savings available by switching from a standard tariff to a fixed deal. You could save more money, up to £300, faster by switching.” | |
| Mark Todd, the co-founder of price comparison site energyhelpline, said 3 million customers a year are ditching expensive standard tariffs and moving to lower-cost fixed rates, and 1.5 million a year are leaving the big six and moving to smaller suppliers. | |
| “Consumers must be aware these price cuts are to very expensive tariffs that are best avoided. Consumers can get much, much bigger price cuts by switching with a price comparison service – typically £300 a year,” he said. | |
| “There’s still no movement on electricity, despite 35% falls in wholesale electricity prices, which is extremely disappointing and means these are only really half price cuts.” | |
| Last year, the Treasury said it planned an investigation into whether companies were passing on the benefits of lower wholesale prices to customers. It then conducted internal studies to examine how far and how quickly the benefits of oil price falls were feeding through to consumers. | |
| Béatrice Bigois, the managing director of customers at EDF Energy, defended the company’s pricing policy, saying: “There are other costs impacting customers’ energy bills that are beyond our control – these increased steadily during 2015.” | Béatrice Bigois, the managing director of customers at EDF Energy, defended the company’s pricing policy, saying: “There are other costs impacting customers’ energy bills that are beyond our control – these increased steadily during 2015.” |
| British Gas said the average annual gas bill would be almost £100 lower than 13 months ago. It said it was the only major supplier to reduce gas prices three times since the start of 2015, resulting in an overall reduction of 14%. | British Gas said the average annual gas bill would be almost £100 lower than 13 months ago. It said it was the only major supplier to reduce gas prices three times since the start of 2015, resulting in an overall reduction of 14%. |
| Mark Hodges, the firm’s head of energy supply and services in the UK and Ireland, said: “Competitive pricing is the way to retain existing customers and win new business in this hard-fought market.” | Mark Hodges, the firm’s head of energy supply and services in the UK and Ireland, said: “Competitive pricing is the way to retain existing customers and win new business in this hard-fought market.” |