British Gas simplify tariffs

The cost of living is spiralling out of control for many with high unemployment, high inflation and Christmas just around the corner.

One of the largest contributing factors to pushing up inflation was the cost of utilities.

Earlier this year all of the UKís six leading energy companies increased their prices on gas and electricity. Prices went up by an average of 20%, adding an extra £200 to the dual fuel bill.

This outraged many and sparked several investigations into the energy firms by industry regulator, Ofgem. A number of which have now been fined on the grounds of poor customer service, mishandling customer complaints, and mis-selling products.

The price hikes are expected to push millions into fuel poverty and the government has spoken out.

Energy Minister Chris Huhne recently warned that gas price rises could increase yet again! Energy prices have been increasing for the last decade as households continue to stump up the cash or go cold.

British Gas leaves customers in the cold

British gas increased the price of gas by 18% and electricity by 11% this year, igniting fury amongst thousands of households up and down the country.

It comes as no surprise that British Gas have confessed to losing customers during the scramble to find a cheaper energy tariff. In fact, they have lost over 100,000 customers to rival energy companies.

This jaw-dropping figure of migrant energy customers represents the number of people who have fled the nest since the beginning of the year, according to city experts.

Managing Director of British Gas, Phil Bentley, confessed that the energy firm had ìnot made it easy for customersí and that it was ëtime for a change.í

In an attempt to repair the damage which has already been done, the company has set out new and simpler tariffs. 

After much thought and consultation regarding how to fix this ëcrisis of trustí, British Gas as devised a cunning plan.

The plan involves setting out just two simple tariff types. One is a fixed tariff and the other is a variable.

If you want to find a cheaper tariff now, compare gas and electricity prices with Money Expert.

But what does this mean for consumers?  Lets find outÖ

Simple tariffs

This will allow you to manage your energy account online or with paper bills and free access to British Gas call centres. Customers will also be able to choose how they pay, spreading their payments out or using direct debits, cash or cheques.

Clearer bills

British Gas customers can now benefit from a full breakdown of all costs and charges associated with providing energy to their home. From this month, bill payers will receive a complete breakdown of all the costs that make up a customerís bill. At a later stage the company will roll out smart meters, which will provide more accurate bills and real-time information to help people keep control of their energy usage.

The aim of change, apart from the need to ërebuild public confidenceí in the company, is obviously to save money on a better deal. However, one simple way British Gas could have done this was by not raising energy prices.

Whilst the price of wholesale gas has increased, subsequently pushing up the price of gas and oil, energy firms have been increasing their prices at a much faster rate.

The change is good news for all bill payers who want the process to become clearer. Itís certainly a step in the right direction after Ofgem had condemned sneaky energy firms for their bad behaviour.

Consumer Force believes this is a welcome change. Adam Scorer, Consumer Focus Director of Policy & External Affairs commented, ìThe penny has dropped. We welcome the news that energy companies recognise that the ways in which they have constructed and sold tariffs has confused, antagonised and alienated consumers.

ìEnergy is a simple product, it should also be a simple market. Reducing the number and complexity of tariffs won’t bring prices down by itself, but it will help people understand their energy costs and get the best deal available.î

Mr Bentley, of British Gas, continued; “It’s time for change. It’s clear that the energy industry is facing a crisis of trust and we have all got to work much harder rebuild public confidence. Customers have given us a very clear message; they want simple tariffs, transparent bills and a fair deal on energy.î

Back in September, Mr. Huhne listed the demands he was placing on energy firms, following a stark warning of plans to ëget toughí on suppliers. 

ìWe want simpler tariffs, requiring energy companies to tell you whether you could buy more cheaply on another tariff,” said Mr. Huhne, speaking to the BBC.

Whilst British Gas cannot control the price of wholesale gas, they have listened to the public. This time they might have got things right first time.

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