Energy regulator Ofgem has handed British Gas a £2.5 million fine for failing to handle customer complaints efficiently.

Ofgem’s investigation highlighted “basic failures” with the way British Gas dealt with its customer service, particularly that the energy provider failed to re-open cases when customers had indicated that their complaint remained unresolved. The company was found to be lacking in its service by failing to give those customers information about resolution services provided by the Energy Ombudsman.

The investigation also concluded that British Gas also lacked adequate processes for dealing with complaints from micro-businesses.

British Gas said the findings by Ofgem were “totally disproportionate” but did admit it failed on the issue of dealing with so-called micro businesses.

Commenting on the fine handed out to the energy supplier, Ofgem’s Sarah Harrison said: “We warned the industry in March that we would be backing up our plans to reform the retail market with a tough approach to enforcement.”

British Gas isn’t the only energy provider to have been brought to task over their standards of customer service. Ofgem is also investigating Npower and EDF Energy for complaint handling, while Scottish Power, Scottish and Southern Energy, Npower and EDF Energy are being investigated for mis-selling.

This is the second time British Gas has been fined this month, having received a £1 million penalty at the beginning of July for misreporting the amount of electricity supplied under the government’s Renewables Obligation.

After upsetting customers by raising gas and electricity prices, British Gas aims to soften the blow by introducing the Home Energy Plan.

Earlier this month, the energy firm attracted plenty of criticism after announcing plans to increase domestic gas prices by 18 per cent and electricity by 16 per cent.

At a time of increasing fuel poverty, many customers were angered by the company’s decision, which is seen as a poorly veiled attempt to protect profit margins (rising wholesale fuel costs and the funding of renewable technology are considered poor excuses by some).

The Home Energy Plan is intended to assuage disgruntled customers by lowering energy bills. Available to only those customers who pay for gas and electricity from British Gas by direct debit, the Home Energy Plan serves to reduce bills through the implementation of energy-saving initiatives.

Under the plan, British Gas will send energy experts to customers’ homes to complete an audit of each property and to recommend various measures to reduce energy consumption.

The energy experts are likely to recommend measures such as loft insulation, cavity wall insulation, double glazing, thermostatic radiator valves, programmable thermostats, hot water tank jackets and so on. After the energy experts have finalised their recommendations, households are provided with an estimated figure of how much money could be saved if the measures are installed or implemented.

The Home Energy Plan would then allow qualifying customers to acquire a Barclays Finance loan (annual interest rate of 6.9 per cent repayable over five, ten or fifteen years). The loan would be provided to cover the cost of installing the energy-saving measures. Interestingly, solar panels are included in the scheme.

Managing Director of British Gas New Energy, Jon Kimber, said: “We know that household budgets are stretched at the moment, but rising energy prices don’t have to mean higher bills. Britain’s housing stock is some of the most inefficient in the developed world with £1 in every £4 spent on heating our homes wasted because of poor insulation.

“Under our offer, customers can improve their homes and save money by cutting bills – all at no upfront cost”.

British Gas has just launched a scheme along the lines of the Green Deal, which is designed to help reduce the upfront cost of installing clean renewable technologies.

Dubbed British Gas’s Home Energy Plan, the scheme is very similar to the Government’s flagship Green Deal, and will enable households to install energy efficiency measures at no upfront cost, including cavity wall insulation, solar panels, air source heat pumps and loft insulation.

British Gas will offer customers a fixed-term loan agreement with a fixed APR of 6.9%, with the loan being repaid through their energy bills using some of the savings they realise through the improvements. Customers will have the choice of repaying the loan over five, 10 or 15-years, which will help ensure repayments are smaller than the savings realised.

They will also be entitled to a free home survey by an energy expert and the company has already trained up 50 energy experts to provide free, no-obligation surveys for households.

Jon Kimber, the managing director of British Gas New Energy, said the premise of the Home Energy Plan was to help customers cope with the increasing costs of energy. According to British Gas the scheme would help customers save £322 on average a year.

British Gas is the first of the energy providers to launch a Green Deal-style initiative, and a spokesperson for the company said the scheme would work along the lines of the Green Deal and would see customers benefiting by investing in green measures with no upfront costs.  Other payment options will also be available.

Business customers are currently not eligible to take part in the Home Energy Plan scheme.

British Gas has today announced that it will be increasing its domestic gas and electricity prices by an average of 18% and 16% respectively.

The price hike follows Scottish Power’s lead, which last month saw the energy provider raise the cost of its gas by 19% and its electricity prices by 10%.

The increase will take effect from 18 August, and will cost the average dual fuel customer around £190 extra a year on  their energy bill. British Gas is blaming the rising wholesale cost of gas, which has gone up by 30% since last winter, for the energy increase.

The energy firm admitted some bills could increase by as much as 24% depending on how customers pay their bills and where they live. The minimum increase will be 12%. The price change will directly impact nine million customers, while a further million have fixed prices so will not be immediately affected.

Phil Bentley, the managing director of British Gas, has said its bills were being driven higher by the fact that the company buys 50% of its gas on the international wholesale market.

“We are buying in a global energy market and have to pay the market rate,” he said. “Rising wholesale costs is an issue facing all energy suppliers.”

Centrica – which owns British Gas – has been warning customers that a price increase was inevitable. So the news, although unwelcome, will come as no surprise.

Energy regulator Ofgem has handed out a £1m fine to British Gas for misreporting the amount of renewable electricity it said it had supplied over a seven year period.

Over the seven year period, British Gas underestimated the amount of electricity supplied by an average of 0.62% per year. The energy provider allegedly reported the wrong amount because it had mis-interpreted Ofgem’s reporting requirements.

Under its ‘renewables obligation’ Ofgem requires energy suppliers to provide evidence of the amount of electricity which was supplied from renewable sources, relative to the electricity they supplied in total.

British Gas brought the error to Ofgem’s attention and co-operated fully throughout the investigation. The amount of the financial penalty was reduced because of British Gas’ co-operation and action over the matter.

David Pimm, Group Finance Director of Ofgem, said: “Ofgem’s decision today sends a clear message to all energy companies that accurate reporting is essential across the energy sector.”

In a move that’s set to revolutionise domestic energy use, British Gas has announced plans to install 260,000 Smart Meters in UK homes in 2011, and over a million in 2012 .

During a special National Home Improvement Council lunch hosted in the House of Commons, sponsored by The Rt Hon Nick Raynsford MP, British Gas Smart Homes managing director, Dean Keeling said the energy firm recognises the need to turn the traditional energy business model on its head when it comes to addressing the dilemma facing the energy industry in Britain today.

“It means a company such as British Gas has to be as much about energy saving as it is about energy supply,” Keeling said.

“De-carbonising power is crucial – cleaner electricity is not only vital in itself, but is a stepping stone to de-carbonising other sectors particularly, heat and transport.”

Keeling said British Gas is commited to rolling out 260,000 Smart Meters this year, with more than a million planned for next year. Revolutionising domestic energy use, according to Keeling, Smart Meters will soon be able to do many things, and will even be able to tell our dishwashers, for example, when the cheapest time is to switch themselves on.

Currently the company is trialing ‘time-of-use’ tariffs with some of its employees.

Smart Meters help consumers control energy use and save money and when combined with energy-saving measures, such as double glazing and loft insulation, can help to reduce the carbon footprint of homes across the UK.

All British Gas customers are due to have Smart Meters fitted in their homes by 2020.

In what looks set to be the UK’s ultimate urban swim festival, British Gas and British Swimming are teaming up this summer for the biggest celebration of swimming the country has ever seen.

The British Gas Big Dip will be heading to London and Manchester and aims to encourage more people to enjoy the benefits of spending time in the swimming pool.

The event will feature a 25m outdoor pool and a beach, giving families the perfect opportunity to indulge in some fun in the sun, whilst participating in a range of activities, ranging from giant slides and aqua fit to water confidence sessions and aqua zumba. Sessions to support adults and children who want to learn how to swim will also be available, and England’s volleyball team will be on hand to provide beginner and skills training and running kids and club competitions.

The British Gas Big Dip London takes place on Clapham Common from June 18th to July 17th.

The British Gas Big Dip Manchester will be held in Spinningfields from July 30th to August 29th.

Tickets for the British Gas Big Dip cost just £3 per adult, which includes free admittance for up to two children aged 12 and under, making it a cheap fun-filled event for all the family.

For more information about the event visit http://bigdip.co.uk

The chairman of Centrica, the parent company of British Gas, has said that it is all but inevitable that British Gas customers will see their energy bills go up this coming winter.

Richard Carr’s not un-surprising admission comes just days after Scottish Power announced their plans to hike their gas and electricity prices by 19% and 10% respectively.

Although British Gas, the UK’s largest energy supplier, refuses to comment on how much its own energy prices will go up by, Carr cites the Government’s green energy policies for future rises.

Says Carr: “Ofgem has said that it would see over the next decade a dual fee bill going up by £500 a year for a typical consumer and that’s related to decarbonisation rather than market forces.”

Carr’s comments echo those of ScottishPower’s UK retail director Raymond Jack, who has partly blamed “the cost of meeting government environmental and social programmes and the cost of distributing electricity on the national grid” for providers charging more for gas and electricity.

But consumer groups have hit back, saying it’s a lack of accountability in the market which allows energy providers to charge what they like:

“Suppliers say they have no choice when costs go up, but no-one else really knows if energy prices are fair,” says Audrey Gallacher, head of energy at Consumer Focus.

With the inevitable rise in gas and electric bills a foregone conclusion in the market, Which?, the product-testing and campaigning charity has also weighed into the debate, advising consumers not to take price increases lying down. From switching to a fixed energy tariff and changing energy providers, there are a variety of measures consumers can implement in order to get the best deal and save money.

The boss of British Gas has warned that energy bill rises are ‘inevitable’ – and the Government’s green policies are to blame.

Chairman of Centrica, Sir Roger Carr, advised that further gas and electricity increases could not be avoided as the UK Government continues to push through its ‘decarbonisation’ agenda. Centrica is the parent company of British Gas, which supplies energy to millions of homes throughout the UK.

Carr noted: “Ofgem [the UK's energy regulator and price watchdog] has said that it would see over the next decade a dual fee bill going up by £500 a year for a typical consumer and that’s related to decarbonisation rather than market forces”.

The Chairman’s comments are unlikely to sit well with those who voted for the ‘greenest ever’ Government, which has, so far at least, failed to reach its carbon emission targets. The coalition also has been criticised for opting to reduce funding for many energy saving schemes and initiatives, leaving voters unsure as to why they are being asked to pay more for less.

Energy Secretary Chris Huhne advised customers to ‘vote with their feet’ by urging people to switch suppliers. Mr Huhne said: “Consumers don’t have to take price increases lying down. If an energy company hits you with a price increase, you can hit them back where it hurts – by shopping around”.

Perhaps Mr Huhne is unaware that the toothless Ofgem has been unsuccessful in ensuring that the UK’s big six suppliers offer competitive prices to consumers; indeed, when one energy firm raises its prices, the remaining five are not far behind.

The Consumer Focus’ Adam Scorer reiterated the point by stating: “You can incite customers to switch all you want but there is nowhere for them to go. It is too difficult for operators outside the ‘big six’ to enter the market and only Chris Huhne or the regulator Ofgem can refer them to the Competition Commission, which so far he has failed to do”.

Householders in the UK can help to reduce their energy bills by employing various energy saving measures throughout the home. Replacing old central heating boilers, installing cavity wall insulation and fitting solar PV panels to the home can help to save or generate energy.

The way we think about energy in the UK is changing. Although currently only about 2% of people are on green tariffs, to try and encourage interest in renewable energy, British Gas has announced the introduction of their new green energyshare tariff.

Energyshare has been designed to help you save energy and money – and perhaps even go one step further by generating your own energy – and the tariff offers renewable electricity at the same price as a British Gas standard tariff.

The energyshare tariff also provides funding to community renewable projects, which are then voted for by energyshare members. The tariff has been designed to increase demand for renewable power, as well as boosting community projects, such as solar panels and local wind farms

The energyshare renewable energy project sees British Gas joining forces with River Cottage. Together they aim to raise £15m over the next five years to help support community renewable energy projects. British Gas has already contributed £500,000 into the energyshare fund. But that’s just the start because British Gas plans to distribute a further £3m to community renewable energy projects through the energyshare fund over the next 3 years.

Benefits of signing up to the energyshare tariff include:

• British renewable electricity at the same price as British Gas’ Standard tariff.
• Your choice of a free product to help you save more energy and money in your home.
• For every year a customer remains on the tariff, British Gas will donate £10 into the energyshare fund to support renewable energy community projects.
• The chance to vote on how money in the fund is spent.
• The energyshare tariff is accredited under the Green Energy Supply Certification Scheme so you can be confident that it will make a real, measurable environmental difference.