Monday 27 April 2015

Cold snap to boost British Gas profits

British Gas profits are expected to rise as a result of the cold start to the year, its owner Centrica said.

Household energy usage was “higher than expected” during the first three months to March due to the drop in temperatures.

Gas consumption was 10% higher while electricity usage rose by 2%, the energy giant said.

The increase in consumption is expected to boost first-half profits compared to last year, when British Gas profits fell 23% to £439 million.

“Overall, the Group continues to trade in line with the guidance provided at the time of its 2014 Preliminary Results in February, with improved year-on-year profitability downstream expected to be more than offset by the impact of lower commodity prices on the upstream business”, Centrica said.

It also warned of problems at Britain’s main gas storage facility, Rough. Last month, the energy firm announced it was reducing the capacity of the site by almost a third.

Centrica expects the limitation to last up to six months while testing and verification works are undertaken.

It added its gas-fired power stations are continuing to produce less electricity than in previous years as they remain expensive to run.

British Gas also announced it will be investing £50 million in the next three years in a bid to improve its customer service.