With British Gas announcing a 12 per cent hike in prices, STEPHEN LEWIS says this is the time to switch suppliers.

MILLIONS of British Gas customers have been urged to consider switching suppliers for a better deal after the energy giant announced record price rises.

The company said gas bills would soar by 12.4 per cent and electricity by 9.4 per cent to compensate for higher wholesale prices.

This week's rise is the second of the year by British Gas, following a 5.9 per cent increase in January.

The increases mean gas customers will see their bills rocket by almost one-fifth in less than a year.

Critics attacked the scale of the increases and warned vulnerable customers would be hit hard.

Jennifer Evans, from price comparison website uSwitch.com, urged the 18.4 million account customers with British Gas to consider switching supplier for a better deal.

Although other gas suppliers are likely to follow suit by hiking their prices too, customers can still make great savings by switching suppliers, she said.

Anyone who had not switched from their original gas suppliers since the gas supply market was deregulated in 1998 - whoever that supplier was - was probably paying 20 per cent more for gas than they needed to.

Analysts say the latest increase, due to take effect from September 20, will add £99 to the annual bill for a family of four who buy both their gas and electricity from British Gas.

Medium-use, dual-fuel customers, such as a couple in a three-bedroom house, will face a rise of £74 a year, according to uSwitch.com.

British Gas said the increases, its highest since the market was opened to competition in the mid-1990s, were due to record wholesale gas prices.

Mark Clare, managing director of British Gas, said: "Depletion of North Sea and Irish Sea gas reserves, the UK's consequent need to import larger volumes of gas, and high oil prices are pushing up wholesale prices. The era of cheap UK energy is over."

The company said it understood some people could be hurt by the increases and has pledged £10 million to set up a fund to assist vulnerable customers who need help paying their bills.

Allan Asher, chief executive of gas and electricity watchdog Energywatch, criticised the increases, calling them "a body blow to consumers." He said: "This price rise is going to add millions to bills and expose many thousands of households to the risk of fuel poverty."

Energywatch said it would be calling for an investigation into the wholesale market.

How to switch suppliers

SWITCHING could not be easier, uSwitch.com insist. Simply log on to its website - www.uSwitch.com - and fill in a simple form. You will be asked for your postcode to help them find the cheapest supplier in your area - the prices charged by suppliers vary by region, so it is no good choosing a supplier recommended by friends who live in Scotland, for example, because the price that supplier charges in Yorkshire may well be different. You will also be asked to estimate the amount of gas you use, and what you use it for: so have a gas bill handy.

USwitch will then identify the cheapest supplier in your area. They will write to your existing supplier on your behalf and to your new supplier informing them you intend to switch, and then will write to you to confirm.

If you don't have access to email, you can phone uSwitch on 0800 093 0607 to do the same thing by telephone.

The company charges your new supplier a small commission for getting your business, but the service to you the customer is free, according to Jennifer Evans, of uSwitch.

Updated: 09:17 Thursday, August 26, 2004