British Gas owner Centrica today cut prices for a second time this year, with electricity tariffs falling by 6 per cent and gas bills down by 3 per cent.
The energy company said its average dual fuel bill was now £207 lower than prior to its first price cut move in March, when gas charges came down by 17 per cent and electricity by 11 per cent.
The reduction turns up the heat on rivals after regulator Ofgem this week said the prices of Scottish Power and EDF Energy were lagging behind other operators.
British Gas said 678,000 new customers had signed up with the firm following the announcement of the first price cut. The business had been losing customers after tariffs started rising three years ago because of the impact of higher wholesale gas costs. It has around 16 million customers.
Managing Director Phil Bentley said: ‘Our two price cuts within the space of seven weeks will mean annual savings of £207 for our customers – while some of our competitors have failed to cut prices even once.’
It said its average dual fuel bill was down to £913 from £1,120.
The first round of price cuts from Centrica prompted similar price cuts from rivals npower, Powergen, and Scottish & Southern Energy.
The latest move by Centrica was welcomed by Ofgem’s Chief Executive Alistair Buchanan.
He said: ‘Today’s announcement by the largest energy supplier, British Gas, of their second price cut is further proof of how competitive the energy market is. Customers are firmly in the driving seat and over 600,000 switched in the first two months of this year alone.’
The price cuts, which take effect immediately, come a week after British Gas was criticised for a surge in customer complaints following the introduction of a new billing system.
Scottish Gas customers will see electricity tariffs drop by 5 per cent and gas rates fall by 3 per cent.
The second price cut means that gas and electricity prices in Scotland have fallen by 20 per cent and 19 per cent respectively since the start of the year.
Scottish Gas said the two cuts will mean annual savings of £223 for its customers.
Switch with Which?
Switch with Which? is the impartial and independent online service from Which?, that helps consumers compare and switch gas and electricity suppliers.
People using the Switch with Which? service can save on average £245* a year by changing their energy supplier(s).
* Average saving made on gas and electricity bills by UK households in 2006, using the Switch with Which? website.
© The Press Association, All rights reserved.