British Gas will raise domestic tariffs for both gas and electricity by an average of 7% on 10 December 2010.

The price change, which will amount to an increase of £1.50 on the average weekly dual fuel bill, will affect around 8 million customers on British Gas' standard and variable tariffs. However, the price rise will not be applied to the company's 300,000 most vulnerable customers until the winter is over. Furthermore, 1.6 million customers on fixed price deals will not be affected in any way.

The announcement follows two years of price cuts led by British Gas totalling £188 per customer per annum.

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British Gas Managing Director, Phil Bentley, said: "We know that rising energy prices come at a difficult time for many in Britain. That's why we are not raising prices for our vulnerable customers, such as the poorest pensioners, until after this winter. We will continue to give them extra help - including lower rates - saving each an average of £128 per year.

"But higher prices needn't mean higher bills with the free energy efficiency help available from British Gas. This year alone, we've fitted more than 120,000 energy efficient boilers and carried out more than 270,000 loft and cavity wall installations in our customers' homes. We're offering free cavity wall insulation to our customers who are 60 years or over, which could save them up to £110 each year.

"We are also helping our customers keep their bills as low as possible with our free online EnergySmartTM service, helping households take control of the amount of energy they use, via free real time monitors. EnergySmartTM can save the average household up to £110 per annum."

(CD/KMcA)