British Gas set to offer £50m help with bills
Another £50 million is being pledged by British Gas to help customers struggling with energy bills as it seeks to head off criticism of its record half-year profit.
Britain’s biggest household energy supplier is expected to announce the voluntary funding package alongside its interim results today, adding to the £50 million of support that it provided to households and businesses last year.
Nevertheless, the company is braced for a backlash and questions over whether it should be doing more to help customers as it enjoys a huge increase in profits.
Centrica, its parent company, indicated last month that British Gas’s first-half adjusted operating profits would significantly exceed the previous record of £585 million set in 2010. Analysts’ estimates vary, but they suggest profits of anywhere from £687 million to £857 million — up from £98 million in the same period last year. This reflects a huge one-off income boost after Ofgem increased the energy price cap this year.
Jeremy Hunt, the chancellor, said this week that companies reporting strong profits must “tell us what they’re doing to keep the cost of living down for their customers”.
British Gas supplies about 7.5 million household customers and 480,000 small business sites. Last year it provided about £28 million in voluntary support to its household customers through grants and non-repayable credit, £6 million to £8 million of support to household customers of any supplier through the British Gas Energy Trust and £15 million of support to its small business customers.
Analysts say the recovery in the fortunes of British Gas could help to lift interim group profits at Centrica — which also has interests in nuclear plants, gas production and storage and energy trading — to a record high. The shares fell ¾p, or 0.5 per cent, to 124p.
• Energy suppliers will have to keep their phone lines open for longer during evenings and at weekends, Ofgem said. The energy regulator is proposing rules to make suppliers easier to contact as a measure to improve customer service. Ofgem also confirmed plans to make suppliers meet minimum capital adequacy standards to try to prevent more company failures.
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