Thursday, 24 February 2011

British Gas profits rose by 24% to a record £742m last year

British Gas has ignited customer criticism after reporting its profits rose by 24% to a record £742m last year.

The announcement was made two months after the company raised prices by 7%, during the worst winter in a century.
Around eight million British Gas customers were affected by the December 10 increase, and saw their average annual bills rise from £1,157 to £1,239.
Adam Scorer of Consumer Focus told Sky News: "Millions of households are suffering from fuel poverty which is when 10% of their income goes on the cost of keeping warm and powering the lights."
"I think when consumers see the size of these profits you can expect them to be somewhere on the spectrum from very frustrated to outraged."
Centrica Share Price 1-Year Chart

Sam Laidlaw, chief executive of Centrica - which owns British Gas - said the energy industry was in a volatile situation with commodity prices, but his company would do all it could to keep bills as low as possible.
He said British Gas would help reduce bills by providing free loft or cavity insulation to customers who buy its electricity as well as its gas.
But speaking to Sky News, British Gas' managing director Phil Bentley seemed to open up the offer to all customers - not just those who were "first in, first served".
But a company spokesman later clarified his comments by saying any customer could apply for free loft or cavity wall insulation as long as they did so online before the end of May.

British Gas is part of the energy giant Centrica
The offer was also limited to 200,000 households, the company said.
British Gas added 270,000 customers last year and is the UK's biggest gas supplier with 16 million customer accounts.
It is owned by energy giant Centrica which also revealed record figures, with its operating profits up by 29% at £2.4bn.
Centrica says recent prices increases were down to soaring wholesale prices.
The company also claims British Gas prices were 0.5% lower at the end of 2010 than at the start of the year after the supplier cut bills by 7% in February.
Ofgem, the energy watchdog, is leading an investigation into the energy giants' balance sheets after discovering average profit margins had increased as companies claimed they had no choice but to lift bills.

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