British Gas is the largest supplier of gas and electricity in Britain, and is now the latest energy giant to hike up its rates. It will be increasing its prices by 18% from 18th August. This constitutes another blow to British households, already concerned about the rising cost of energy. Research by the consumer magazine Which? shows that rising energy prices are consumers' primary financial concern. It is estimated that customers will pay an extra £200 a year.
Today's announcement is unsurprising. Last month Scottish Power announced it would be increasing gas prices by 19% and electricity charges by 10% from 1 August, and it is expected that the other 'big six' energy companies will continue to follow suit. Phil Bentley, British Gas' Managing Director, explained that the company's costs were being pushed up by the fact that the company buys 50pc of its gas on the international wholesale market. He said: "We are buying in a global energy market and have to pay the market rate. Rising wholesale costs is an issue facing all energy suppliers."
It will not only be a blow to millions of households struggling to pay bills, it will also have a significant impact on the British economy more broadly. The imminent rise in power prices, almost impossible for households to avoid, will leave even less disposable income for spending on non-essential items, deepening retailers' woes. Which? executive director Richard Lloyd says: 'Many people are already having to cut back on essentials because of the rising cost of living, and with average bills rising even further, it could be a cold winter for many.'