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British Gas, the country's biggest energy provider, is expected to announce a price rise today that could add an extra £100 a year to household bills.
It is expected to be close to the nine percent increase that has already been announced by its rival Scottish & Southern Energy that will come into force on Monday.
Utility providers blame wholesale gas prices (the cost of gas to the supplier), Government policy, the cost of using the National Grid and their investment in infrastructure for their tariff hikes.
Wholesale gas prices
- Energy watchdog Ofgem says more than half of domestic bills are made up of wholesale costs
- Wholesale prices are linked to changes in oil price, both are rising due to strong demand and tight supply
- Domestic British suppliers are supplying less, meaning increased reliance on pricier imports
- Gas and electricity supplier SSE say the mandatory environmental and social initatives such as the Carbon Emissions Reduction Target and the Warm Homes Discount have risen by 30% in the past year
- SSE says these account for 10% of a typical bill
National Grid costs
- The cost of using the National Grid networks, which represents around 25% of a typical bill, is 9% higher than last year, according to SSE
British Gas has refused to comment on ITV's Business Editor Laura Kuenssberg report that it will announce price hikes as early as tomorrow:
Latest ITV News reports
The Chancellor has urged energy companies to reconsider their price hikes, in an interview with ITV News.
Households across Britain could be plunged into a "long, cold winter" after two major energy suppliers increased their prices today.