Business

British Gas plans to offer free power on Saturdays

British Gas logo above hob flame
Image caption Earlier, British Gas warned that fuel bills could go up again this winter

British Gas has said it is planning to offer free power on Saturdays to some of its customers.

The idea is to encourage them to use more of their electricity at the weekend when there is less demand from businesses, according to the BBC's industry correspondent John Moylan .

The scheme would be available to its one million UK customers who have smart meters.

However, analysts have questioned the complexity and coverage of the idea.

Smart meters

British Gas is understood to have already started piloting the scheme.

The energy firm plans a bigger pilot later in the year and the scheme could be offered to consumers from 2014.

The roll-out of smart meters is at an early stage in the UK. Every household will eventually have one by the end of the decade, but Centrica claims that it has installed more of them than the rest of the industry put together.

The parent company, Centrica, already offers the scheme - called Free Power Saturday - in its Direct Energy operations in Texas and the north-east of the United States.

Complexity

Under the proposed scheme, customers get 24 hours of free electricity every Saturday by agreeing to switch more of their usage to the weekend.

However, the saving does not extend to gas usage, which makes up about 60% of the typical household's energy bill. Only a small proportion of customers have smart meters fitted, which they would need to be able to benefit from the plan.

Mark Todd, of comparison website Energyhelpline.com, said this could lead to a saving on only a fraction of energy use, although it was unusual to find deals that offered straightforward savings.

The tariff for the rest of the week is yet to be revealed, and savings would depend in part on customers' behaviour.

Clare Francis, energy expert at MoneySupermarket.com, said that customers might be able to use their washing machine on a Saturday, but could not switch appliances such as fridges off and on.

She added that it added an extra layer of complexity to an energy bill and might make it more difficult to compare the costs with other energy providers.

The government and the energy regulator Ofgem have been working to simplify bills in the last 18 months, after widespread criticism that energy bills were too complicated.

Rising profits

The new offer comes after British Gas warned that UK domestic energy bills could go up again this winter. The company attracted criticism after raising energy prices for UK households by 6% in November 2012.

The residential arm saw profits rise 3% to £356m, up from £345m a year earlier.

Overall, Centrica's adjusted operating profit rose 9% to £1.58bn for the six months to 30 June, up from £1.45bn for the same period in 2012.

British Gas has introduced a Tariff Checker to help its customers work out if they are on the cheapest tariff.

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