Centrica to offer cut-price energy with British Gas X

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British Gas owner Centrica is set to enter the cut-price energy market by trialling a new digital energy ‘challenger’ brand, currently known as British Gas X.


Aimed at younger, ‘digitally-savvy’ households, British Gas X will offer a fixed-price dual fuel tariff with no exit fees.

Customers will be expected to manage their accounts online with extra support available through a web chat team, while electricity will be sourced by sustainable means, backed up by Renewable Energy Guarantees of Origin (REGO) certificates.

Households looking to sign up for British Gas X will need to pay by Direct Debit on a standard meter and switch both their gas and electricity together. The supplier says it will not offer smart meter compatibility to start, so customers will be required to submit monthly meter readings, even if they do have a smart meter installed.

No official launch date has been given yet, though British Gas owner Centrica has promised to announce more details in July.

Cost-cutting amid increased competition

Centrica last week announced 5,000 jobs were to be axed in cost-cutting measures and has faced increased competition in recent years from smaller rivals, with millions being lured away by lower energy prices due to reduced overheads.

The firm has also said that falling gas prices and the Ofgem energy price cap contributed to huge losses in 2019.

Once the UK’s only supplier of gas, British Gas is still the country’s largest energy supplier, with more than seven million customers, though last year alone 290,000 customers made the switch to a cheaper provider.

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There are currently around 60 energy suppliers in an increasingly competitive market and the once-dominant ‘Big Six’ have faced challenges to adapt. SSE was recently purchased by Ovo Energy and medium-sized providers, such as Bulb have made significant gains in recent years.

By contrast, over twenty start-up energy companies have ceased trading in the last year, leaving many customers in the lurch.

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Commenting on recent money-saving measures, Centrica Group chief executive Chris O’Shea said: “We have great people, strong brands that are trusted by millions and leading market positions, but the harsh reality is that we have lost over half of our earnings in recent years. Now we must bring focus by modernising and simplifying the way we do business.

“I truly regret that difficult decisions will have to be made and understand the impact on the colleagues who will leave us. However, the changes we are proposing to make are designed to arrest our decline, allow us to focus on our customers and create a sustainable company.”

By keeping costs to a minimum with British Gas X, Centrica hopes to win back some of those former customers, in addition to holding on to current households with the attraction of cheaper energy.

British Gas X is not Centrica’s first attempt at a digital energy service. The firm already offers online-only business energy through British Gas Lite, but this is its first foray into the domestic low-cost energy market.

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