Gas Tariff

bitwist

I am a British Gas customer who was paying 2.44 per unit for gas before my contract finished in January. Like everyone else, I was then put onto their standard tariff of 4.01 per unit and told that on April 1st that this would change to 7.33 per unit. I did the math and my contract price of 2.44 to 7.33 is an increase of 200%. My standard tariff at 4.01 to 7.33 new tariff is an increase of 83%. Ofgem increased the tariff by 54%, not 83% Can they get away with this because there are no cheaper tariffs around?

MWT

bitwist said:

Ofgem increased the tariff by 54%, not 83% Can they get away with this because there are no cheaper tariffs around?

No, Ofgem did not increase the tariff by 54%.

The oft quoted 54% cap increase is the average increase in annual cost (including standing charge) across the regions of the UK for a customer using 2900kWh of electricity and 12,000kWh of gas and paying by direct debit.

Individual components of the cost will have gone up by more or less than 54%...

[Deleted User]

bitwist said:

I am a British Gas customer who was paying 2.44 per unit for gas before my contract finished in January. Like everyone else, I was then put onto their standard tariff of 4.01 per unit and told that on April 1st that this would change to 7.33 per unit. I did the math and my contract price of 2.44 to 7.33 is an increase of 200%. My standard tariff at 4.01 to 7.33 new tariff is an increase of 83%. Ofgem increased the tariff by 54%, not 83% Can they get away with this because there are no cheaper tariffs around?

People quote the 54% as if it was Gospel. It is simply the percentage increase on the October 21 Ofgem Capped tariff based on fixed annual consumption figures. Historically, fixed tariffs have always been cheaper than the Ofgem Cap: the Cap was brought in as a ceiling not a floor.

The increase in gas is higher than that for electricity as it is the wholesale cost of gas that is causing us some many problems. 

As you yourself have said, you came off a cheap fixed tariff onto the Ofgem Cap which was a hike in itself. The Cap has now increased so your increase was always going to be much higher. In sum, it is all perfectly legal.

EssexHebridean

bitwist said:

I am a British Gas customer who was paying 2.44 per unit for gas before my contract finished in January. Like everyone else, I was then put onto their standard tariff of 4.01 per unit and told that on April 1st that this would change to 7.33 per unit. I did the math and my contract price of 2.44 to 7.33 is an increase of 200%. My standard tariff at 4.01 to 7.33 new tariff is an increase of 83%. Ofgem increased the tariff by 54%, not 83% Can they get away with this because there are no cheaper tariffs around?

Tell you what - go and have a quick look at the upcoming increase in the unit cost for your electricity and see what percentage that reflects... In a similar vein, compare the increases in the gas and electricity standing charges too - again, you'll see that there is a dramatic difference between the two. Others have explained why this is, but in short, nobody is "getting away with" anything.