British Gas was accused of clobbering families with unjustified price increases today as owners Centrica posted eye-watering new profits.
The energy giant cashed in on the cold weather earlier this year, making a staggering £1.58 billion profits in just six months.
British Gas caused a storm by raising its prices by an inflation-busting six per cent in November last year, just before the winter chill forced families to turn up their heating.
Its half-yearly profits for the six months to June 30 soared by nine per cent from £1.45 billion for the same period in 2012.
Michael Fallon, the Energy Minister, fired a warning shot, telling the Evening Standard: “They should certainly show restraint in future prices. There have been some big increases and they need to show restraint.”
British Gas’s residential arm saw profits rise three per cent to £356 million, up from £345 million a year earlier.
Centrica’s results come a day after French energy giant EDF reported UK pre-tax profits of £903 million.
Labour’s shadow energy secretary Caroline Flint said: “When times are tough, energy companies should be helping their customers, not clobbering them with price rises.
“This is yet more evidence that David Cameron’s failure to stand up to the big energy companies has left the public being ripped off. The time has come for a complete overhaul of our energy market.”
She said Labour would break the dominance of the energy giants and open up the energy market, creating a tougher energy regulator.
Centrica said “significantly higher environmental and commodity costs” had affected British Gas Residential’s operating profits. Gas consumption rose by 13 per cent compared with the same period last year.
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It laid some of the blame for higher costs on the government-imposed Energy Company Obligation scheme, designed to help low-income families with heating bills and green insulation. The obligations would add £1.4 billion to costs by 2015.
Chief executive Sam Laidlaw insisted: “With our customers using more gas to stay warm during the unusually cold winter, we’re doing everything we can to help them keep their energy costs under control.”
The company said British Gas Residential’s full-year operating profits would be “broadly in line” with 2012’s figure of £606 million.
Earlier this week Centrica announced that it had bought the energy marketing business Hess Corporation in a £657 million deal. It has also invested £44 million in shale gas exploration in Lancashire.
