Citizens Advice: Latest fuel price hike ‘hard to understand’

Citizens Advice Scotland has said British Gas customers will “find it hard to understand” a 5.5% price hike taking effect from 29 May.

British Gas claims it is increasing prices because of increased wholesale costs, but the UK government has said the rise is “unjustified”.

Energy Minister Claire Perry said the government is “disappointed by British Gas’s announcement of an unjustified price rise in its default tariff when customers are already paying more than they need to”.

Craig Salter, energy spokesman for Citizens Advice Scotland’s consumer futures unit, said: “Consumers will find it hard to understand how a 5.5% price hike on their fuel bills, on top of a 7.3% increase for dual fuel customers less than 9 months ago, can be justified.

“This will see fuel bills rise at several times the rate of inflation for a significant number of customers, with an increase of 13.2% over just 10 months for those on dual fuel tariffs.

“While increases in suppliers’ costs are likely to lead to higher prices for consumers, any reductions in costs should also be reflected in household bills. If costs do not rise as forecast, we would expect these increases to be quickly reversed for consumers.

“It is important that suppliers give sufficient warning of price increases, and that reductions in supplier costs are also reflected in household bills. In future the UK Government’s proposed safeguard tariff could be used quickly to avoid sudden and steep price increases for those on default tariffs.

“We also know that households that rely on electric heating, of which there are 282,000 in Scotland, are highly vulnerable to fuel poverty and have been particularly hard hit by recent price rises.”