Energy prices increase – and so do profits


London, U.K. — (METERING.COM) — March 25, 2008 – Utilities in the U.K. have all increased their electric and gas tariffs in recent weeks – and now British Gas has announced record operating profits, generating some adverse comment.

According to gas and electricity watchdog energywatch, average gas bills have risen 108.6% and electricity bills by 69.6% since January 2003. The most recent utility – the last of the big six –to announce price hikes was Scottish and Southern Energy (SSE), whose customers’ gas bills will go up by an average of 15.8%, with electricity bills increasing by an average of 14.2% on 1 April.

The recent announcement of record profits achieved by British Gas’s residential operations, coming hard on the heels of the utility’s 15 percent increase in energy tariffs, has enraged both customers and energywatch.

The utility has blamed volatility in wholesale energy markets for the increase, which Adam Scorer, Director of Campaigns for energywatch, acknowledges is a reality. He went on to point out, however, that the people suffering as a result of wholesale price increases appeared to be the utility’s customers, not its shareholders.

British Gas says that the residential arm would have registered a loss rather than a profit had the increases not been introduced.