| Gas to cost 15% more in 2006, experts warn |
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LONDON: Gas and electricity will cost 15 percent more by first quarter 2006, energy analysts said yesterday.
The experts’ opinion echoed the statement by Mark Clare, managing director of British Gas, (Scottish Gas in Scotland), the country’s biggest gas supplier. Mr Clare told reporters that consumers should expect higher prices early next year. It is “inevitable” that soaring wholesale costs would force all gas suppliers in the UK to raise their prices in the coming months, he said.
Suppliers were more than likely to announce price rises, he emphasised saying “I don’ think we have any choice” considering the current level of wholesale prices. Suppliers “are already having to pay very high prices for gas for January and February” he said.
Millions of UK households could expect their annual fuel bills to go up by £100. If that happens, it would take the average gas and electricity bill up by 50 percent in three years.
With the mercury dropping lower everyday consumers have to turn up their heating and the Met department forecasts a colder than usual winter this time. It will be a 1-in-10 winter, i.e. the kind of winter that comes once every ten years, they say.
British Gas has already imposed double digit increases this year. Price rises announced in November by Scottish Gas, Southern Energy and German-owned Npower will come into effect starting 1st January.
The British Gas chief sought to reassure consumers that the company was trying to hold or minimise price rises in the coming months by “reducing costs as fast as we can”. There was also no reason to worry about supply interruptions, he said.
Meanwhile consumer watchdog Energywatch has opposed the gas suppliers’ statements. The prices rises are “wholly unnecessary”, it said. Allan Asher, chief executive of Energywatch explained that the energy “market isn’t working effectively” resulting in consumers and businesses paying billions more. The domestic gas market has too little competition, he said. The market has only 6 suppliers today compared to 22 in 1999.
Regulator Ofgem was also of the opinion that gas and electricity prices were certain to rise in the coming months.
Posted
on : Fri, 30 Dec 2005 14:05 GMT | General News
By : Anne Philips
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