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British Gas owner Centrica reports 2% operating profit rise

Centrica owns British Gas. Credit: PA

British Gas owner Centrica has fuelled further controversy after reporting profit rises.

It reported a two per cent rise in UK and Ireland operating profits to £906 million, helping group operating profits jump four per cent to £1.5 billion.

The company is expected to face fresh calls to address tariffs for businesses and domestic consumers.

Centrica's British Gas residential energy supply arm, which only covers UK homes, reported an 11% drop in operating profits to £553 million, compared with £623 million in 2015, but said the reduction was due in part to a customer exodus.

More than 409,000 UK home customers left the business in 2016, marking a 3% fall to 14.25 million.

British Gas announced it was extending a price freeze on its standard energy tariff until August, "despite increases in external costs", but customers are expecting prices to soar later this year, following the Brexit-induced collapse of the pound and rising wholesale energy prices.

The industry has faced increasing pressure to treat loyal customers fairly and has been criticised for being slow to pass on falls in wholesale gas prices, with consumer groups hitting out at the size and timing of cuts.

British Gas announces 'price freeze until August'

Credit: PA

British Gas will extend a price freeze for customers on its standard energy tariff until August.

Mark Hodges, head of British Gas' owner Centrica, said: "We're pleased to give our customers on standard tariffs the peace of mind that the price they're paying will remain unchanged until August.

"We are determined to give our customers great offers and services. In December we promised to take tangible action to improve how the energy market works for all our customers. That effort continues.

"We aim to do even more in the coming months to meet our customers' needs, earn their business, and reward their loyalty."

However ScottishPower customers were not so fortunate as the company announced a 7.8% rise in standard gas and electricity bills following "rises in energy wholesale markets and compulsory non-energy costs."

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