British Gas has announced that it will reduce its gas and electricity prices from March 2007, cutting gas prices by 17% and electricity by 11%.  According to the company this would see the average annual dual fuel bill fall by £167 to £953. Many commentators believe that other energy companies have been waiting to see British Gas’s move before also cutting their prices.

According to the BBC, British Gas has increased gas prices seven times and electricity tariffs six times since 2002, while it last cut prices in the spring of 2000.

Whilst a cut in prices is to be welcomed, wholesale gas prices have fallen by about 50%, so the company is passing on only part of its saving, leading to widespread criticism.  In the short term utellus would encourage consumers to continue searching for the best prices; in the longer term, however, we recognise that constant switching of suppliers carries its own costs and we hope that suppliers will aim to build long term relationships with their customers based around price and service.