April 10, 2018 / 9:28 AM / 9 months ago

British Gas raising energy prices by 5.5 percent

LONDON, April 10 (Reuters) - British Gas will raise the price of its standard variable tariff (SVT) for dual fuel customers by an average of 5.5 percent from May 29, parent firm Centrica said on Tuesday.

Increases to electricity and gas charges will add 60 pounds ($85) to annual bills for 4.1 million SVT customers, raising them to an average of 1,161 pounds, the company said.

British Gas withdrew its SVT default tariff for new customers on March 31 and is working to move customers off SVTs and on to fixed tariffs. The company will not offer SVTs to new customers.

“This increase is largely due to rising wholesale and policy costs. Similar pressures were cited by Ofgem when they increased the prepayment meter cap by just over 57 pounds on 1st April,” British Gas said in a statement.

In February, energy market regulator Ofgem said British energy customers covered by a cap for the most vulnerable households, typically on prepayment meters, will see bills increase by an average of 57 pounds a year from April 1.

On announcing the rise, Ofgem Chief Executive Dermot Nolan said the move was not a “green light” for energy suppliers to raise their standard tariffs.

Britain’s government is putting a wider price cap on standard variable tariffs due to rising energy bills. Home power bills have doubled in Britain over the past decade to an average of about 1,150 pounds a year.

“Wholesale gas and electricity costs and the costs of government policies, including the smart meter roll-out and schemes to reduce carbon emissions, continue to rise,” British Gas said in a statement.

“We continue to advocate that the funding of all Government policy costs should be paid for in a fairer way such as through general taxation,” it said.

$1 = 0.7064 pounds Reporting by Nina Chestney; editing by Jason Neely

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