Consumers Urged to Shop Around for Gas
The announcement of record profits by Centrica, the company that owns British Gas, has led to calls for consumers to shop around to avoid overspending on gas.
Recent price hikes by a number of gas suppliers made the winter of 2010/11 a difficult one for many UK residents, who struggled to afford the cost of keeping their homes warm as temperatures outside dropped below -15 degrees in many places.
But Centrica’s announcement that operating profits had risen 29 per cent to a record-breaking £2.3 billion, with British Gas itself making a £742 million profit, has outraged the public and industry commentators alike.
Scott Byrom, energy manager at MoneySupermarket.com said: "The announcement is a real bitter pill to swallow for Britain's hard pressed households who have suffered the double whammy of an extremely cold winter, coupled with high gas and electricity prices. While many customers were struggling to heat their homes and afford their bills it looks as though British Gas was reaping the benefits.
"Such announcements act as a stark reminder to bill payers that apathy won't be rewarded. Remaining on the same energy tariff year after year is costing millions of people dearly.”
Statistics from gas and electricity industry regulator Ofgem show that 57 per cent of UK households have never changed their energy provider or the deal that they are on. In the current marketplace, consumers can make significant savings on their energy deals by purchasing online.
Scott Byrom added: "It is vital consumers shop around for a better value deal as soon as possible to ensure they don't continue to pay over the odds for their energy.”
Calls for a Competition Commission inquiry into the energy market have abounded in the wake of Centrica’s profit announcement and Ofgem is currently leading an investigation into the balance sheets of energy providers. The case could be referred to the Competition Commission within a month.
Centrica, however, claims an inquiry could have a damaging effect on the wider industry.
A spokesperson for the company told The Telegraph: “We don’t believe it would be justified on any economic basis, but if there is a sector referral to the competition authorities, then so be it.
“However, this should not happen simply for populist reasons. A competition inquiry is likely to take at least two years and could have a chilling impact in our industry.”
He added: “Every year we publish full accounts and people pore over our profits, costs and prices. We have nothing to hide.”
Consumer Focus CEO Mike O’Connor told The Guardian: “We need successful energy companies but consumers may look at today’s profits and at recent price rises and question how one justifies the other.”
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