Your bills help British Gas to £600m profit

Big Six under scrutiny as Centrica figures enrage MPs and watchdogs

Anger towards the Big Six energy suppliers will intensify this week as British Gas-owner Centrica prepares to reveal a bumper £2.5bn profit while households struggle with rising energy bills.

The 2013 profits will be unveiled just a week after the Secretary of State for Energy, Ed Davey, called for regulator Ofgem to launch a full-blown investigation into the profits the Big Six make from selling gas to households. He said he suspected energy companies of overcharging, and identified British Gas as the supplier making the biggest profits from gas.

Centrica is set to announce on Thursday that its British Gas household supply arm made a profit of nearly £600m last year, helped by a 10.4 per cent hike in gas prices in November and an 8.4 per cent rise in electricity prices.

Politicians and campaigners said the bumper profits provided further evidence that showed the Big Six were overcharging customers in an uncompetitive market.

The Shadow Energy Secretary, Caroline Flint, said: "Yet again we see an energy company making huge profits on the back of spiralling bills for hard-pressed customers. The reason the energy companies think they can get away with treating their customers so poorly is because they know David Cameron will never stand up to them."

Ann Robinson, of the USwitch price comparison website, said: "If Centrica have increased their profits I think British Gas customers will be entitled to wonder whether they should have suffered a price rise just in time to provide more misery going into winter.

"This is why we do need Ofgem, the Office of Fair Trading, and the Competition and Markets Authority to take a long hard look at what is going on and come up with strong proposals for making this market work for all of us."

Adam Scorer, director of Consumer Futures, said: "The announcement of Centrica's huge profits will inevitably cause some anger at a time when so many consumers are struggling to pay their bills. But anger won't help consumers, only action to reduce their exposure to rising prices will."

Centrica's forecast profit for 2013 represents a 2 per cent increase on the previous year. The British Gas household supply component fell by about 2 per cent over the same period, as the impact of lower usage during the mild winter outweighed the higher prices, according to forecasts by Angelos Anastasiou, an analyst at stockbroker Whitman Howard. In December, British household gas usage was 9 per cent down on December 2012, because of warmer weather.

Chris Weston, managing director of British Gas, said: "Britain has one of the most competitive energy markets in the world." He said that British Gas profit margins were, on average, about 5 per cent after tax and that Centrica had invested £13.7bn in the UK, employs 30,000 people and pays about £1bn in tax.

British Gas cut its electricity and gas prices by 3.2 per cent in January after the Chancellor, George Osborne, shifted some green levies from household bills to the taxpayer.

A Department of Energy spokesman said: "While we don't comment on individual companies' results, we are pushing for much greater openness and transparency in the financial reports of all energy companies so that consumers know exactly how their money is being spent."

Start your day with The Independent, sign up for daily news emails
Sport
Andy Murray reaches the final of the Australian Open after beating Tomas Berdych in another impressive display, but the match was marred by ill feeling
sport
News
peopleKim Sears wears 'Parental Advisory– Explicit Content' at final
News
The guide, since withdrawn, used illustrations and text to help people understand the court process (Getty)
newsMinistry of Justice gets law 'terribly wrong' in its guide to courts
News
Bobbi Kristina Brown with her mother Whitney Houston in 2011
people
PROMOTED VIDEO
News
Starting the day with a three-egg omelette could make people more charitable, according to new research
science
News
Top Gun actor Val Kilmer lost his small claims court battle in Van Nuys with the landlord of his Malibu mansion to get back his deposit after wallpapering over the kitchen cabinets
people
News
Comedian Ted Robbins collapsed on stage during a performance of Phoenix Nights Live at Manchester Arena (Rex)
people
News
The actress Geraldine McEwan was perhaps best known for playing Agatha Christie's detective, Miss Marple (Rex)
peopleShe won a Bafta in 1991 for her role in Oranges Are Not The Only Fruit
News
newsPatrick Cockburn was able to update his agenda-setting 'The Rise of Islamic State' while under attack in Baghdad
News
Robert Fraser, aka Groovy Bob
peopleA new show honours Robert Fraser, one of the era's forgotten players
Life and Style
Torsten Sherwood's Noook is a simple construction toy for creating mini-architecture
tech
Sport
David Silva celebrates with Sergio Aguero after equalising against Chelsea
footballChelsea 1 Manchester City 1
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Software Development Manager

£40000 - £50000 per annum: Recruitment Genius: This is an exciting opportunity...

Ashdown Group: Product Manager - (Product Marketing, Financial Services)

£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Recruitment Genius: Compliance Assistant

£13000 per annum: Recruitment Genius: This Pension Specialist was established ...

Ashdown Group: Market Research Executive

£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...

Day In a Page

As in 1942, Germany must show restraint over Greece

As in 1942, Germany must show restraint over Greece

Mussolini tried to warn his ally of the danger of bringing the country to its knees. So should we, says Patrick Cockburn
Britain's widening poverty gap should be causing outrage at the start of the election campaign

The short stroll that should be our walk of shame

Courting the global elite has failed to benefit Britain, as the vast disparity in wealth on display in the capital shows
Homeless Veterans appeal: The rise of the working poor: when having a job cannot prevent poverty

Homeless Veterans appeal

The rise of the working poor: when having a job cannot prevent poverty
Prince Charles the saviour of the nation? A new book highlights concerns about how political he will be when he eventually becomes king

Prince Charles the saviour of the nation?

A new book highlights concerns about how political he will be when he eventually becomes king
How books can defeat Isis: Patrick Cockburn was able to update his agenda-setting 'The Rise of Islamic State' while under attack in Baghdad

How books can defeat Isis

Patrick Cockburn was able to update his agenda-setting 'The Rise of Islamic State' while under attack in Baghdad
Judith Hackitt: The myths of elf 'n' safety

Judith Hackitt: The myths of elf 'n' safety

She may be in charge of minimising our risks of injury, but the chair of the Health and Safety Executive still wants children to be able to hurt themselves
The open loathing between Barack Obama and Benjamin Netanyahu just got worse

The open loathing between Obama and Netanyahu just got worse

The Israeli PM's relationship with the Obama has always been chilly, but going over the President's head on Iran will do him no favours, says Rupert Cornwell
French chefs get 'le huff' as nation slips down global cuisine rankings

French chefs get 'le huff' as nation slips down global cuisine rankings

Fury at British best restaurants survey sees French magazine produce a rival list
Star choreographer Matthew Bourne gives young carers a chance to perform at Sadler's Wells

Young carers to make dance debut

What happened when superstar choreographer Matthew Bourne encouraged 27 teenage carers to think about themselves for once?
Design Council's 70th anniversary: Four of the most intriguing prototypes from Ones to Watch

Design Council's 70th anniversary

Four of the most intriguing prototypes from Ones to Watch
Dame Harriet Walter: The actress on learning what it is to age, plastic surgery, and her unease at being honoured by the establishment

Dame Harriet Walter interview

The actress on learning what it is to age, plastic surgery, and her unease at being honoured by the establishment
Art should not be a slave to the ideas driving it

Art should not be a slave to the ideas driving it

Critics of Tom Stoppard's new play seem to agree that cerebral can never trump character, says DJ Taylor
Bill Granger recipes: Our chef's winter salads will make you feel energised through February

Bill Granger's winter salads

Salads aren't just a bit on the side, says our chef - their crunch, colour and natural goodness are perfect for a midwinter pick-me-up
England vs Wales: Cool head George Ford ready to put out dragon fire

George Ford: Cool head ready to put out dragon fire

No 10’s calmness under pressure will be key for England in Cardiff
Michael Calvin: Time for Old Firm to put aside bigotry and forge new links

Michael Calvin's Last Word

Time for Old Firm to put aside bigotry and forge new links