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British Gas pledges no price hikes in 2014

Joanna Faith
Written By:
Joanna Faith

British Gas will not raise prices this year, its parent company Centrica announced today, despite slashing its earnings outlook.

The energy giant said challenging market conditions on both sides of the Atlantic meant full-year earnings will be lower than expected.

However the firm, which raised prices by 9.2 per cent in November, said “the competitive market and wholesale price environment” meant it did not expect to change its prices in 2014.

The average bill for a British Gas customer was around 10 per cent lower this winter than last, thanks to milder weather conditions.

The warmer than normal temperatures in the first four months of the year saw gas and energy consumption fall by 25 per cent and 10 per cent respectively.

Centrica chief executive Sam Laidlaw, said: “While earnings are anticipated to fall in 2014, we expect an improvement in 2015, assuming more normal weather conditions and reflecting the prospects for underlying growth in Direct Energy, UK gas storage, British Gas Services and British Gas Business.”

The firm said “fierce competition”, particularly from smaller suppliers, meant it had lost 180,000 residential accounts so far this year.

Last month, small providers First Utility and Ovo both launched competitive new tariffs under £1,000 in the space of week.

Mark Todd, director of price comparison website energyhelpline.com, said these new deals “created a massive gulf between them and the big supplier’s standard prices, which most consumers pay.”