British Gas Bills May Rise:

British Gas will tomorrow warn householders that their annual gas bills may jump by as much as 30% next winter.  The huge rise, the result of soaring wholesale gas prices, would push the average household energy bill to more than £1,200 a year. 

The company, which provides gas to nearly half the nation’s homes, said it was being forced to put up prices because its retail gas business would otherwise plunge into the red. Forecast wholesale prices for next winter put gas at 85p a therm compared with 47p last winter. The coded warning of more increases in gas prices will come in a trading statement tomorrow, just five months after parent company Centrica reported annual profits of £1.9bn. It will come as yet more unwelcome economic news for the Government, which is battling to fight inflation in the face of soaring domestic energy bills and petrol at £5 gallon. 

The wholesale price of gas is rising because Britain is forced to import more rather than relying on North Sea supplies. Last year the UK imported 27% of its gas needs, but this figure is expected to hit about 40% in 2008. Centrica is considering buying a third share of a giant £2.5bn wind farm in the Thames Estuary. Shell is selling its stake in the London Array project seven miles off the north Kent coast, which when completed will be the biggest wind farm in the world, with 300 turbines. Sarwjit Sambhi, Centrica’s director of power generation and renewables, said: ‘We would certainly be interested in acquiring this stake.