British Gas owner Centrica has revealed that the energy giant is expecting a 6% rising in profits, as its customers prepare for a 6% hike to energy prices this week.
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The company argued that British Gas profits would hit £575m, meaning that the Big Six supplier is on track to make £1.4bn profits after tax this year. This comes as SSE defends 38% rise in profits in wake of their energy price increases too.
Centrica noted that the uncertain economic climate was having an impact on households, with a slight decrease in demand as customers employ more energy efficiency measures. New boiler installations were also down by 16% in the first 10 months of the year.
The company has blamed energy bill increases on the costs of upgrading the UK’s gas and electricity grids and carbon reduction targets. It also said that it had experienced a 13% rise in wholesale gas prices for this winter.
Responding to Centrica’s interim management statement, Audrey Gallacher, Director of Energy at Consumer Focus, said:
“Consumers will be sceptical over supplier profits given questions over how justified recent price rises have been.
“We need profitable companies for our economy and to invest in energy infrastructure. But customers need to know that the relationship between costs, pricing and profits is fair. This can only happen by making the market more transparent.
“It is essential that all energy firms are required to provide information that is fully clear and comparable, including profit and trading information from across the whole of their business, if customer distrust is to be tackled.”
SSE’s also announced a 38% rise in profits, taking adjusted pre-tax profits to £397.5m for the six months to September. Despite this increase the company forged ahead with raising gas and electricity prices by 9% on in October.