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September 09, 2005
Oil forces utilities price rises
British Gas is planning to increase the price of gas and electricity by 14%. The company will increase residential charges to British Gas and Scottish Gas customers from 19 September, in response to rising oil prices and shrinking domestic gas reserves.
British Gas, which is part of the Centrica group, will offer a £60 rebate to 250,000 low-income customers to help them pay bills over the winter. It will be paid in two instalments, in November 2005 and February 2006.
British Gas managing director, Mark Clare said: "We are no longer an energy island - spiralling world oil prices are now having an unprecedented impact on the cost of gas as the UK is now dependent on imports,"
Powergen and EDF Energy, rivals to British Gas, have also increased prices due to the surge in commodity costs. Crude oil prices increased to over $70 a barrel after Hurricane Katrina hit the Gulf coast and North Sea reserves are declining, making wholesale prices more expensive Powergen increased electricity and gas prices by 7% and 12% respectively. EDF Energy increased the cost of electricity by 10% and gas by 12%.
According to Energywatch, the consumer organisation, domestic gas and electricity prices increased by 21% and 17% respectively in the 18 months to August.
British Gas increased its prices twice in 2004, prompting over 900,000 customers to change to a different supplier.
Posted by at September 9, 2005 11:14 PM
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