MP slams global gas giant as it reveals 14% profits rise. There's a warning for energy watchdog to grow teeth

WESTMORLAND MP Tim Farron has criticised the global giant that runs British Gas for making profits from people after hiking energy bills.

Centrica, which owns British Gas, today reported an adjusted operating profit of £2.7bn for 2012 - up 14% on its 2011 performance.

But the MP accused the company of putting 'profit above people' and had a warning for energy watchdog OFGEM that it needs to grow teeth.

Mr Farron said the company racked up energy tariffs - the prices for which people pay for their energy - by six per cent for around 8.5 million households at the end of last year.

In its preliminary results for 2012, Centrica said that, cold weather in 2012 saw average domestic gas consumption increase by 12 per cent.

It also said its overseas operations were doing well with adjusted operating profit up by 78 per cent. However, it also said it had contributed £1 billion in taxes.

Mr Farron has said that if OFGEM does not act he will ask the government to step in and formally regulate the market – including setting limits on bills.

He has demanded that British Gas immediately cut household bills following the announcement of their profits.

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Mr Farron said: “I am today calling on OFGEM to act and if they don’t I will push strongly for the government to step in and look at amending the forthcoming energy bill to help bring down prices - but the only decent thing that British Gas can do in response to their huge profits is to immediately cut their bills to customers.”

“The energy companies are drinking in the last chance saloon – they cannot just keep hiking up prices, when they are making such big profits. They must be made to realise that they are looking at stringent regulation that could ensure that their future profits will be minimal – unless they start to treat their customers fairly.”

In today's results, Centrica said it had invested £2.7 billion in 2012, including the construction of a £1.4 billion North Sea Cygnus gas field which they said had created 4,000 UK jobs and is producing gas for 1.5 million UK homes.

It also referenced 'positive results' from exploration drilling at Rodriguez and Whitehaven, following 'lower levels of drilling success in 2012.

Sam Laidlaw, Chief Executive of Centrica, said in the company statement: “We have taken the lead during 2012 in helping more households save energy and supporting the people who need the most help.

"It’s important that Centrica makes a fair and reasonable return so that we can continue to make our contribution to society and to invest."

"Last year we incurred a tax charge of over £1 billion and invested over £2 billion to secure new sources of energy for the UK, well in excess of our profits.”
 

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