Centrica plans to cap profits to lower energy bills

Centrica’s chief has backed a CfD regime for existing low carbon electricity generators

Net Hero Podcast

British Gas owner Centrica is reportedly considering joining a voluntary scheme that would see profits being capped.

This follows ministers’ plans to renegotiate existing contracts with wind, solar and nuclear projects that have made windfall profits as a result of soaring energy prices.

A few days ago, trade body Energy UK backed the idea of offering longer-term agreements with lower returns to existing nuclear plants and renewable generators to reduce energy bills.

The scheme would replicate the Contracts for Difference (CfD) scheme.

Chris O’Shea told the Guardian: “Sometimes if you go to the government and propose you take a lower price they look at you like there must be something else in it for you.

“We are obviously in this business to create value for all of our stakeholders, customers, country and colleagues.

“But it’s not about maximising this year’s profits; it’s about having a long-term sustainable business.

“We supply more than eight million homes and businesses in the UK with energy – if they can’t afford their energy, we don’t have a sustainable business. And so when you think about this holistically… if we put something like a CfD regime in place for existing assets then, God forbid, if this ever happens again and we see prices go where they go, there’s an automatic adjustment mechanism.”

Last month, British Gas, the UK’s largest energy supplier committed to donating 10% of its profits to support its customers struggling with soaring energy bills.

The cash is said to be allocated to the British Gas Energy Support Fund.