British Gas and SSE join price cut battle - 13/01/2012

Two more domestic energy suppliers have announced cuts in their prices, which could enable a greater number of people to get cheap gas and electricity prices.

Yesterday, (January 12th), British Gas said it was cutting the cost of its electricity tariffs by five per cent, saving the typical customer £24 a year, which was followed shortly by SSE reducing its gas prices by 4.5 per cent.

While British Gas will implement its price drops immediately, SSE users will have to wait until March 26th to see the decrease take effect.

Commenting on British Gas' move, director of energyhelpline Mark Todd said that while every price cut is welcome, customers will find it "baffling" the firm is not reducing its gas prices to pass on savings in wholesale costs.

In its statement, the firm explained this is because it has to buy its supplies of the commodity well in advance and, despite recent falls in its expenses, "the longer term trend continues to be upward".

However, Mr Todd observed the cost to energy suppliers of purchasing gas has dropped by 32 per cent compared with the peaks of early September.

As this expense makes up 47 per cent of the price of domestic gas tariffs, he noted: "The maths don't seem to add up so British Gas need to do something on gas as well if they want to look like they are passing on wholesale falls fairly."

The spokesman for the price comparison site said customers need more than small-scale cuts on electricity and it will be interesting to see how the remaining Big Six domestic energy suppliers react.

Make sure you're not paying too much for your energy - compare gas and electricity prices now at energyhelpline.com or call 0800 074 0745