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 In 2005,
Centrica issued a statement on behalf of its subsidiary British Gas regarding
energy partners.
The statement
introduced an increase in domestic energy prices in response to recent moves by
competitors Powergen (E.ON) and EDF Energy.
The company
introduced a 14.3 percent increase in gas and electricity prices and came back
on the record highs in the costs of wholesale gas driven by soaring oil prices
and declining North Sea gas reserves.
At the time,
Centrica acknowledged the considerable risk and volatility in the wholesale
energy markets in the fourth quarter of the year, and based on forecasts for
wholesale prices, Group earnings for 2005 were towards the lower end of market
expectations.
In an
independent report that year, results had shown a $10 USD per barrel increase
in the price of crude oil gave rise to an extra £50 per year on the average
domestic gas bill. Global Insight had also found that oil-gas linkage resulted
from non-liberated markets in Europe and would cost the UK an additional £10
billion in 2006.
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Despite the
concern of the rising energy costs, British Gas advised they would offer support
to a quarter of a million of its most vulnerable customers through a rebate of
up to £60, to offset the increase that winter. |
The rebate was
the biggest single social initiative carried out by any UK energy company, and
came on top of the existing £10 million British Gas Energy Trust Fund that helps
customers in debt that require financial assistance to pay their bills.
It was also
stated that the one million customers who signed up to British Gas’ Price
Protection, an insurance that capped energy prices until 2007, would not be
affected by the increase until April 2007. And they (British Gas) were in the
process of launching a further fixed price product enabling dual fuel customers
to fix their energy prices until 2010 at no extra cost.
British Gas’
Managing Director Mark Clare had said: “We are no longer an energy island -
spiralling world oil prices are now having an unprecedented impact on the cost
of gas as the UK is now dependent on imports. In these difficult times it is
more important than ever that our customers take action to save energy and so
reduce their bills. British Gas already invests £130m a year in energy
efficiency measures for customers and we will now offer additional incentives
for those that are prepared to take action. We are also offering a winter rebate
to offset the cost of this increase to our most vulnerable customers who would
otherwise be hit hardest.”
Visit British
Gas to find out more on how to save energy, including advice on getting the most
this winter out of your
radiators.
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