Centrica hikes gas, power bills for second time in a year |
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Published
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Thu, 27 Jul 2006 11:40
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LONDON: British power utility Centrica Plc., which owns British Gas, is hiking gas and electricity bills for a second time in 2006 as the company posted a 29 per cent drop in its first half profits.
The company, the country's largest energy supplier with 16.6 million customers, said Thursday gas bills will go up 12.4 per cent and power bills 9.4 per cent effective 4 September.
Centrica had imposed a huge 22 per cent rise in gas and power bills on 1 March.
According to the company, it is losing money because it is paying more for the gas it is buying from other suppliers than it charges its retail users. It claimed wholesale costs of gas had gone up 71 per cent in the last one year in addition to similar increases in previous years.
Centrica said group operating profits fell 29 per cent to 692 million pounds. Its pretax profit for the period fell 325 million pounds to 569 million pounds.
The company said it is confident wholesale gas prices would come down from beginning 2007 as gas imports pick up towards the end of 2006. It promised customers a price cut of 5 per cent from the start of 2008.
The company is planning to set up a new power station at Langage in Devon and has agreed to a new coal-linked contract with Drax power plant in North Yorkshire.
Operating profit at the company's British Gas Services fell 25 per cent to 44 million pounds, while operating profits at its Gas Production unit rose 30 per cent to 704 million pounds.
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