British Gas has today announced that it is hiking the cost of electricity by 12.5% or £76 a year for 3.1 million families.
The Big Six energy giant confirmed the price rise, which will take effect on September 15, after a blunder on Monday saw the group mistakenly publish an incomplete statement about increasing electricity tariffs on its website.
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The rise - which will only affect customers on its standard variable tariff for electricity - will see the average dual fuel bill for a typical household jump £76 to £1,120 a year - a 7.3% increase.
Collectively, it will add an annual total of £235.6 million to energy bills ahead of the coldest season of the year.
British Gas's standard variable tariff for electricity is currently the cheapest of all Big Six offers - however, according to consumer website Uswitch, it is still £286 more expensive compared to the rest of the market.
In a league table, the comparison website put IRESA's Flex4 Standard Direct Debit in the top spot - with a typical annual energy cost of £834 compared to British Gas at £1,120.
Claire Osborne at USwitch said: "At a time when living costs are rising faster than wages, this hike could push many families into the red. Customers should not be lulled into a false sense of security.
"The British Gas standard tariff remains the cheapest among the big six but it is still £286 more expensive that the cheapest deal on the market today.
"It's time switch supplier and send a message that price rises like these just aren't acceptable. Seven in 10 households are overpaying for their energy on expensive standard tariffs, yet within ten minutes they could switch and save hundreds of pounds – as well as protect themselves against further hikes by fixing their tariff."
Why are prices going up?
British Gas is the last of the Big Six providers to increase prices after it promised last year to freeze tariffs until August. This is now coming to an end.
In a statement, the company said it held off from the price rise a for "up to six months longer than some of our competitors".
The group cited rising policy and network costs for the increase - and while it's the last to up prices, experts have warned it could be the start of a fresh wave of hikes for households.
It comes after Centrica-owned British Gas saw profits tumble 26% to £381 million this year over warmer than normal temperatures and the pre-payment tariff cap.
It's half year results also revealed a loss of more than 377,000 UK customer accounts in the first half of 2017.
Centrica said the rise was a result of "transmission and distribution costs" and "government policies"
Iain Conn, the chief executive of Centrica, told BBC Radio 4's Today programme that while the commodity price of electricity had come down, it was facing "significant cost pressure" on transmission and distribution, as well as costs associated with Government policy.
"The net effect of both of these is an increase of about £62 on the average bill, and that is the main driver of the increase, combined with the fact that our electricity prices at British Gas have been some of the cheapest in the market, and actually we're now selling our electricity at a loss, which is clearly not sustainable."
A spokeswoman for the Department for Business, Energy and Industrial Strategy said: "Energy firms should treat all their customers fairly and we're concerned this price rise will hit many people already on poor-value tariffs."
Stephen Murray, energy expert, MoneySuperMarket added: "This announcement from British Gas must be one of the worst kept secrets in the history of the energy industry.
"The summer months are a time when many people take their eye off their energy bills and there is a danger that millions of British Gas customers will miss this or shrug their shoulders in passive acceptance.
"But they will really feel the impact when the big winter bills start to come through and they are paying hundreds of pounds more than savvy consumers who have moved away from incredibly expensive standard tariffs."
£76 credit to 200,000 customers
British Gas has also today announced that it will give 200,000 'warm home discount' customers a one-off £76 credit to offset the tariff increase.
Switch your energy supplier
Switching energy tariffs every year or so is a smart way to keep your bills as small as possible, yet millions of us don't bother
Seven in 10 households are overpaying for their energy on expensive standard tariffs - but there is a way out. Switching to a cheaper plan can knock hundreds off your bill and get it fixed for winter too.
This means your prices won't fluctuate - which is often what happens with standard tariffs - often the most expensive around.
Martin Lewis explains: "This is British Gas' catch-up price hike. It was the only one of the big 6 firms not to raise prices at the start of the year, and now, as predicted, it'll do it from September. And that means if, as is possible, we see another batch of rises this coming winter, its customers will feel like they've been price-slapped twice in rapid succession.
"So let this be a clarion call for British Gas customers (and all those on big 6 standard tariffs) – do not sit on your backside and just take this. For someone with typical use, on British Gas' standard tariff you're going to be paying £1,120 a year from September.
"The cheapest tariffs on the market are £844 for the same usage. And switching is usually no big deal - there's no break in service, no engineers coming to call – it's the same gas, same electricity, same safety – only the price and who provides customer service actually changes."
The easiest way to switch your supplier
Enter your postcode
Enter your usage information - For the most accurate comparison results, you'll also need to input your household's consumption details. You can get those off your most recent energy bill.
Once you've picked your new energy supplier and plan, confirm the switch by providing your full address and bank details (if you've chosen a direct debit plan, which are usually the cheapest).