'This beggars belief': Anger as British Gas owner's profits soar after £500m boost from Ofgem energy price cap
27.07.2023 - 08:11
/ manchestereveningnews.co.uk
British Gas' owners has reported that its earnings have soared by almost 900% following a £500 million price cap boost - as critics have slammed the latest figures.
Centrica, the company's owner, said underlying earnings at its gas and electricity supply arm leaped 889% to £969 million in the six months to June 30 from £98 million a year earlier. It said the result was buoyed as Ofgem’s price cap in the first half of the year allowed it to recoup losses seen a year earlier - to the tune of around £500 million.
The price cap saw customers' bills limited to £2,500 a year under the Energy Price Guarantee. Overall, Centrica swung to a £6.5 billion operating profit in the first six months of the year against operating losses of £1.1 billion a year earlier.
Try MEN Premium for FREE by clicking here for no ads, fun puzzles and brilliant new features.
On an underlying basis, operating profits rose to £2.1 billion from £1.3 billion a year ago. Energy firms saw their supplier profit margins hit last year, when wholesale prices were sent soaring by Russia’s invasion of Ukraine but the price cap protected customer bills from the worst of the rises.
Wholesale prices have come down in 2023, while the price cap has been set at a level by Ofgem this year to allow firms such as Centrica to recover some of those earlier losses. Centrica said it lost about £250 million in the first six months of 2022 alone due to the price cap coming in lower than the cost it faced in wholesale markets, with the impact at its worst in the final quarter of 2022.
But Wednesday’s update comes at a sensitive time – with households and businesses continuing to face high energy bills and widespread cost pressures. Simon Francis, co-ordinator of the
The website popstar.one is an aggregator of news from open sources. The source is indicated at the beginning and at the end of the announcement. You can
send a complaint on the news if you find it unreliable.