BRITISH GASP

0 Comments | Sunday Mirror, Jan 27, 2008 | by STEPHEN HAYWARD Consumer Correspondent

BRITISH Gas is set to announce pounds 800million profits for 2007 - 800 per cent up on the previous year.

The staggering figures emerge after the company put bills up by 15 per cent - leaving hard-pressed families facing hikes of around pounds 130 on energy bills which now average pounds 1,000 a year.

Watchdogs are furious that the six big energy suppliers are ramping up prices despite vast increases in their takings.

They are demanding an inquiry into claims the firms - whose profits jumped 30 per cent from pounds 3.7billion to pounds 4.9billion - are acting like a cartel to fix prices.

Energywatch boss Allan Asher said: "These profits show the price rises are unjustified and inflicting considerable pain on consumers, especially those who can least afford it.

"It's the very evidence that should prompt a Competition Commission inquiry into the workings of the energy industry." Germanowned Npower, which has hammered its seven million customers with hikes in bills of up to 27 per cent, is set to announce pounds 500million profits, up from pounds 383million.

Last week it emerged the firm cut off the most customers - 69 a week in the first nine months of 2007, while total disconnections hit 176 a week, up from 56 a week in 2005. German rival Powergen and Spanish-owned Scottish Power - expected to raise prices 15 per cent this week - are both on course for pounds 750million profits.

French supplier EDF, which has put up bills by around 15 per cent, will pocket pounds 900million.

UK-owned Scottish and Southern Energy, which has promised to hold down bills until the end of March, is also set to make record profits of pounds 1.2billion, up from pounds 858million.

Suppliers blame rocketing fuel bills on the wholesale prices they pay, up more than 60 per cent in a year, along with transport and distribution costs.

A spokesman for British Gas - owned by UK-based Centrica - said last night: "At current wholesale prices, we would be loss-making in 2008 without the price increase.

"For our most vulnerable customers, we have delayed bringing in price increases until the end of winter."

But Mark Todd of independent switching service Energyhelpline said the bills were "totally unjustified".

He added: "Last year most firms waited until spring to bring down bills because of the fall in wholesale prices but now they're whacking up everyone's bills in the depths of winter."

Gordon Lishman, of Age Concern, said: "Rising bills can lead to older people cutting back on their heating.

"The government and energy companies must work together to address the huge pressure that expensive fuel bills place on the poorest."

The scandal comes as research by Energywatch reveals 80 per cent of more than 1,110 customers with complaints were unsatisfied with the way they were handled.

And 15 per cent of those say they complained five times or more before anything was done. Karl Brookes, of Energywatch, said: "This is yet one more reason why the Competition Commission should investigate the market."

How the profits add up

British Gas (Centrica) pounds 800m (up pounds 705m)

Scottish & Southern Energy pounds 1.2bn (up pounds 440m)

Powergen (E-on) pounds 750m (up pounds 150m)

Npower (RWE) pounds 500m (up pounds 117m)

EDF pounds 900m (down pounds 32m)

Scottish Power (Iberdrola) pounds 750m (down pounds 150m)

'This is inflicting real pain on poor families' ALLAN ASHER, ENERGYWATCH

'Older people are cutting back on heating' GORDON LISHMAN, AGE CONCERN

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