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Energy firms should slash prices, says group

Energy firms should slash prices, says group

Category: Gas and electricity

Updated: 30/07/2009
First Published: 30/07/2009

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

A consumer champion group has called on energy firms to make further cuts to their prices, after profits at British Gas' residential arm increased significantly over the last six months.

Energy group Centrica, which owns British Gas, announced that pre-tax profits in the last six months fell from £993 million in the same period last year, to £875 million.

However, its residential business saw a marked increase, with pre-tax profits rising from £166 million to £299 million. The firm cut the price of gas by ten per cent in February and electricity by the same price in May.

"The new business structure in British Gas will continue to improve the way we serve our customers," it said, "particularly those in financial hardship, and the value of the propositions we offer."

The increasing profits of its residential business has not gone down well with the Consumer Focus group, which has called on British Gas and other energy firms to pass on savings made through falling wholesale prices.

"Millions of consumers paying high prices will be disappointed, but sadly unsurprised, that energy firms are making such large profits. Any business needs to make a profit but it must also give a fair deal to its consumers," said the group's energy expert, Robert Hammond.

"Wholesale energy prices have come down and remain low, so we believe that energy firms across the board should be making significant further price cuts. The companies must also take action to ensure fair pricing for the poorest consumers being charged more for paying by pre-payment meter, cash or cheque."

The Government should step in to ensure savings are passed on to customers if necessary, Mr. Hammond added.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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