August 28, 2004

British Gas Prices

British Gas is the latest supplier to announce an increase in their domestic energy prices, effective from the 20th September 2004, amounting to 12.4% for gas and 9.4% for electricity, has hit the headlines in terms of the headline figures. But with price rises that will affect 13.4 million customers, of which 5 million take both gas and electricity from British Gas what does this really mean to British Gas?

Looking back over the last few years British Gas have always been ahead of the pack when it comes to increasing their domestic energy prices:

1 Apr 2001 : British Gas increased gas prices by an average of 4.7%
3 Jan 2002 : British Gas increased gas prices by 5.3%
14 Apr 2003 : British Gas increased gas and electricity prices by 2.5%
10 Jan 2004 : British Gas increased gas and electricity by 5.9%

Interestingly if we look at a snapshot of the financial results of the British Gas (residential) over the same period we see:

So in the same period, 2001 to 2004, where British Gas have increased prices no less than five times, always on the basis that their base costs have increased exponentially, we actually discover that British Gas has increased their operating profit per customer by 210%.

In the same period customer numbers have increased by just over 500,000 domestic customers. The last price increase in Jan 2004 may have cost British Gas just over 300,000 customers, but this must surely have been compensated by the increase in operating profit of £59 million.

Posted by energylinx at 01:41 AM Technorati: Energy Prices

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