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Barclays faces record £290m fine by US energy regulator

Barclays faces a record fine of $470m (£290m) over alleged energy market manipulation.
Barclays faces a record fine of $470m (£290m) over alleged energy market manipulation. Credit: PA

US regulators FERC (Federal Energy Regulatory Commission) has threatened Barclays with a record fine of $470m (£290m) to settle allegations of manipulation of Californian electricity markets.

The bank and four traders are accused of rigging the markets over two years from 2006.

FERC has given Barclays 30 days to appeal against the fine.

uSwitch: 'British Gas should lead the way in cutting customers a fair deal'

Anne Robinson from consumer website uSwitch has said that British Gas should be asked why they do not reduce prices when wholesale prices drop.

She added that it was time that, "British Gas as the largest of out energy companies showed the way and cut their own customers a good deal.

"My advice to consumers is to shop around. There aren't enough of us doing it, it's only when we engage in the market that companies will start treating us fairly."

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Centrica profits rise by 28% to £682 million

The stronger performance at British Gas helped Centrica's underlying earnings rise 14% to £767 million - slightly better than City expectations.

Its upstream gas and oil production business saw profits rise 28% to £682 million, buoyed by £1.2 billion of acquisitions.

The group yesterday announced a £1.4 billion investment with GDF Suez to develop a major North Sea gas field off the coast of Norfolk, creating some 4,000 jobs. It is believed to be the largest gas discovery in the southern North Sea for 25 years.

However, it said it will review the future of gas-fired plants at Peterborough and Roosecote in Cumbria because of challenging conditions. It follows its decision to close a station in King's Lynn.

The company said changes to carbon allowances will render much of its UK gas-fired generation fleet unprofitable from 2013.

Chief executive: 'Centrica has performed well'

Centrica, which owns British Gas, said higher volumes and tariffs more than offset the higher commodity prices and other costs. But it claims to control just 15% of a customer's bill through its operating costs and profit margins.

Chief executive Sam Laidlaw said:

Centrica has performed well in the first half of 2012 despite challenging market conditions, although the increase in earnings must be placed in the context of unusually low levels of consumption and profits in the UK in the first half of 2011.

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British Gas makes £1.9 million profit a day

The rise in profits means that British Gas Residential made some £1.9 million of profit a day as consumers struggle to cope after the average dual fuel bill rose to £1,310 a year - more than £200 higher than two years ago.

British Gas bill
British Gas profits rise

Richard Hall, head of energy regulation at Consumer Focus, said:

"Wholesale prices rose a little earlier in the year but are now falling and they are still a long way from their peak in 2008.

"We have long questioned whether drops in wholesale costs find their way through to household bills."

British Gas profits rise to £345 million

Centrica said profits at British Gas Residential, which has 15.8 million energy accounts in the UK, lifted to £345 million in the six months to 30th June after volumes were boosted by the cool start to the summer.

But the UK's biggest energy supplier also benefited from higher prices. Although it had dropped its standard electricity prices by 5% in January, this did not cancel out a 16% rise in August, when gas bills also went up by 18%.

Consumer Focus has accused utility companies of being quick to pass on rising wholesale costs to consumers but being slow to drop prices when they fall.

Profits at its residential arm are also higher because of weak figures a year ago when it delayed passing on price rises to customers, meaning it was supplying at a loss.

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