Fury at British Gas profits as fuel giant warns of price rises to come

Published on Wednesday 28 July 2010 17:23

THERE was growing anger last night after British Gas announced doubled profits while warning of price increases to come.

The company's operating profit reached 585 million during the first half of 2010 - 98 per cent up on the same period last year - largely due to a bitter winter which saw heating and gas usage rise by 8 per cent.

British Gas parent company Centrica insisted much of the money will go towards meeting the rise in wholesale gas prices, which it says have already gone up this year and expects to continue.

However, wholesale prices are currently less than half what they were at their peak in 2008, at 47p per therm compared to 99p two years ago.

Consumers said Centrica should do more to help customers instead of protecting the interests of its shareholders.

Trisha McAuley, head of services and advocacy at Consumer Focus Scotland, said: "Millions of Scottish customers struggled to afford high energy prices over one of the coldest winters in recent years and for British Gas and other companies the result is massive returns.

"Such huge supplier profits will sound alarm bells, yet again, over wholesale price cuts not being fairly passed on to consumers. We are concerned that energy firms may actually raise prices this winter.

"With only small price cuts for customers in the last two years, despite wholesale prices being half what they were at their peak and beginning to fall again, customers will rightly be outraged if this happens."

A spokesman for Age Concern Scotland added: "Energy prices went up significantly a few years ago, and although they have dropped back that has been by less than half of what they increased.

"Some people have to make very hard choices at winter time. Literally, in some cases, it comes down to a choice between heating their homes or eating properly - that's not an exaggeration. We would expect these companies, making massive profits, to pay a little back and make the lives of the poor and vulnerable that little bit better, rather than purely satisfying their shareholders."

British Gas, which now supplies more than 16 million households in the UK, said it would try to keep bills down but made no promises.

Sam Laidlaw, chief executive of Centrica said: "This is a competitive market so we can't give any signals but our position has always been to lead the market down and try to delay any price increases as long as we can."

Independent price comparison website energyhelpline.com defended British Gas.

Director Mark Todd said: "British Gas has led the field with price cuts over the last 18 months and it would not have attracted 223,000 new customers if it was charging too much. The company now has the cheapest electricity and dual fuel for standard customers and its online tariff is the cheapest in the market."