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Fuel Poverty News

British Gas makes a killing - 17 Jan 09


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Britain's biggest power firm is set to unveil record annual profits of £2billion as families struggle to pay their highest-ever winter fuel bills.

Quarterly bills averaging £413 will be sent to British Gas’s 16million customers in the next few weeks – up 43 per cent on last year. And the next bills after that in the spring will soar to an average £502.

Last night MPs and consumer watchdogs slammed the firm’s owner Centrica for making the profit – up £100million on last year and the equivalent of £225,000-an-hour – while failing to pass on sharp cuts in wholesale gas prices to customers.

David Orr of the National Housing Federation, which represents housing associations across the UK, said: “British Gas has shamelessly ripped off millions of households for years by overcharging for gas and electricity. Ministers must levy a windfall tax on suppliers, with the proceeds being used to help people in fuel poverty.”

British Gas customers are paying £1,322 a year for gas and electricity. But watchdogs believe suppliers could afford to slash bills by a fifth. Labour MP Fabian Hamilton said: “They were quick to raise prices when the wholesale price of gas was rising. Yet when prices came down, energy bills did not.”

Since last January an extra million households have been pushed into fuel poverty – defined as spending 10 per cent or more of income on heat and light.

Mark Todd, of price comparison service, said: “Five-and-a-half million households are now trapped in fuel poverty. It means 12 million people can’t afford to heat their homes.”

Only Scottish and Southern Energy has pledged to pass on price cuts to customers. Suppliers say they buy gas supplies a year in advance so retail prices lag behind wholesale trends.

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Source: Daily Mirror