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British Gas Price Hike?

CONSUMERS SUFFER AS BRITISH GAS REPORTS 83% RISE IN OPERATING PROFITS, AND 62% RISE IN CUSTOMER MARGINS

- uSwitch.com slams ‘scandalous’ profits -

Commenting on Centrica’s results issued today, Alan Tattersall, Head of Home Services at independent comparison and switching service uSwitch.com, said: “It is disgraceful that British Gas has been able to squeeze these scandalous profits out of their customers – they are already the UK’s most expensive gas supplier, and today’s results just reiterate how little regard they have for their customers, whilst looking to reward their shareholders with a 59 per cent increase on dividends.

“British Gas has used rising wholesale gas prices as a smokescreen to extract ever increasing margins of profit from their customers. These profits are as a direct result of the record price increases of up to £150* per year, that British Gas inflicted on their customers over the course of 2004.

“British Gas have been hit by huge customer desertions last year as over a million customers finally lost their patience at continually paying over the odds for their energy, and have chosen to switch to cheaper suppliers. Unless British Gas stop treating their customers as commodities this haemorrhaging will continue unabated.

Tattersall concludes: “Despite their customer losses, 57 per cent of gas customers in Britain remain with British Gas despite them being the most expensive gas supplier. If you remain with your incumbent suppliers (British Gas and your local electricity board) you are paying over 20 per cent more for your energy than you should. By switching to cheaper suppliers, customers could save up to £170 a year.”

8th January 2004

"DOING THE RIGHT THING'BY HIKING PRICES?
OVER TWO MILLION BRITISH GAS CUSTOMERS TO SWITCH TO
CHEAPER SUPPLIERS REVEALS USWITCH.COM RESEARCH

British Gas customers in the dark about 5.9 per cent increase on 10 January

Over two million British Gas customers are set to desert the energy giant in the wake of a third price hike in two years.

British Gas has increased gas and electricity prices by an average nine per cent since April 2002 and in a survey* for independent household bills comparison service uSwitch.com, British Gas was criticised by almost half (43.3 per cent) of its customers for increasing prices solely to make a bigger profit.

The survey also reveals that more than two thirds (67.96 per cent) of British Gas customers feel their loyalty as a longstanding customer is being abused - six in ten (63.5 per cent) only found out about the latest 5.9 per cent increase to their bill after uSwitch.com researchers informed them! And eight in ten were in the dark (87.13 per cent) that this weekend's price rise is the energy giant's third hike in two years.

Jon Miller, head of products at uSwitch.com commented: "British Gas must ask themselves if they are doing the right thing by their customers. The fact is they have increased gas and electricity prices three times in the last two years by an average 13.2 per cent and 4.8 per cent respectively. They are still one of the most expensive gas suppliers on the market.

"British Gas customers should follow Ricky Tomlinson's lead and 'do the right thing' by switching to a cheaper supplier. There is no home like a cheaper home!"

Miller said: "Unfortunately it is exactly this consumer inertia that suppliers will continue to take advantage of. However, it is encouraging to see from our research that BG customers are waking up and voting with their feet to change to a cheaper supplier."

Other findings:
One third of BG customers think the energy giant is poor on price
41 per cent of BG customers think it is mediocre on service
Nearly a fifth have experienced problems with BG
The two key areas that BG customers have experienced problems with are billing (27 per cent) and customer service (28 per cent)

Miller continued: "British Gas' planned increase means the average customer will pay ??34.84** more a year. It is crucial that in the current economic climate, consumers are shopping around for the best deals. Consumers who have never switched before can make average savings of GBP140*** a year."

uSwitch.com provides free independent and impartial advice to consumers about which tariffs would best suit their needs. By simply entering the postcode into the uSwitch.com calculator ) consumers can assess the options available to them and make an informed choice.

For more information visit our uSwitch page

Notes to editors:
*Research was carried out by eDigitalResearch.com on behalf of uSwitch.com between 21 December 2003 and 2 January 2004. 1358 British Gas customers were interviewed.

**Figures are based on the average increase for a medium user (19,050Kwh gas, 3,300Kwh electric).

***Average annual savings consumers can make by switching their gas and electricity via uSwitch.com (??80 for gas and ??60 for electricity)

About uSwitch.com:
uSwitch.com is a free, impartial online comparison service which helps consumers compare prices on gas, electricity, home telephone and digital television. Our aim is to help customers take advantage of the best tariffs and services on offer from every supplier. The company has developed a calculator which evaluates a number of factors including price, location, service and payment method, and advises consumers on the best deal to suit their needs.

If they chose to, consumers can switch while they're online or phone customer services direct.

uSwitch.com is not a supplier but acts as an independent advisor, giving consumers an impartial view of what's on offer. Unlike traditional brokers, it compares prices from all energy suppliers, not just those it has a commercial relationship with. The service is based on the most up-to-date information provided by the supplier companies and industry regulators.