British Gas faces backlash

The UK energy consultancy McKinnon & Clarke has criticised British Gas along with its profitable competitors such as Scottish Power for not reducing consumers’ energy bills following the slump in wholesale gas and power prices during the recession.

British Gas, the residential arm of UK utility Centrica, announced today that profits soared 58 per cent last year. Meanwhile Scottish Power revealed yesterday a modest 7.9 per cent growth in profits. 

McKinnon & Clarke has described the dramatically rising profits as ‘indefensible’ as people struggle to heat their homes. 

The consultancy’s energy analyst, David Hunter said: ‘Failure of the “Big 6” suppliers to pass on to customers the massive reductions in wholesale energy prices, which they have been enjoying since 2008, is scandalous.’

Since summer 2008, the consultancy pointed out that wholesale gas prices have dropped from a peak of more than £1 per therm to around 38p - electricity from £90 per MWh to around £37 - falls in the region of 60 per cent. Yet, costs to homes are as much as 35 to 40 per cent higher for gas and 10 to 15 per cent more for electricity than before the huge price rises of 2008.