The news that gas and electricity bills will rise by 18 and 16 per cent respectively
will have many reaching for a bottle of scotch just to keep warm. At an immediate level, this is another act in the ongoing drama about rising living costs; but it runs deeper too.
British Gas says that the price rises are concurrent with inflated wholesale prices. Wholesale prices began to grow last July, a result of Qatari liquefied natural gas being less readily available and the increasingly unreliable connection from Norway. Global economic recovery has also affected prices where supply is weak. But might the gas companies still be being rapacious? Ofgem is currently investigating several companies for hiding a substantial gap between what they paid to buy a commodity and what they subsequently charged as the wholesale price. This latest rise will presumably receive similar scrutiny.
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