Britain leaving the European Union could increase gas bills, Centrica warns

“British Gas has cut standard gas prices three times in the last past year, but it should now go further and reduce electricity bills too”.

The company announced a 5.1% cut to consumers’ energy bills last week, following a fall in wholesale gas prices, however, they were the last of the Big Six to do so, sparking accusations they had maintained the higher prices through the colder months, despite paying less for the gas themselves.

“The lower commodity price environment will inevitably continue to have an impact on the earnings and operating cash flow from our E&P (exploration and production) and central power generation businesses”, said Centrica Chief Executive Iain Conn, who took over a year ago after a career at oil producer BP.

Centrica said the increase in British Gas profits was mostly down to the increased consumption in power by householders.

British Gas has also announced it will reduce gas tariffs by 5.1 per cent from March 16.

The Competition and Markets Authority has been conducting a wide-ranging investigation into the UK’s energy suppliers since last summer.

It has said previously it is unable to lower electricity prices due to rising costs, such as for network delivery.

The energy company declared a final dividend of 8.43p, in line with the previous year and expectations, and taking the full year dividend to 12p compared with 13.5p in 2014.

Revenue decreased by 5% to £28.0 billion and adjusted operating profit fell by 12% to £1,459 million.

The Centrica-owned supplier insisted the £574 million haul – up from £439 million in 2014 – came on the back of increased energy demand rather than profiting from falls in wholesale prices. Centrica has stated that even if current commodity prices persist it should still be able to grow its operating cash flows, while capex in the upstream business can be reduced further if necessary.

Steve Clayton, analyst, at Hargreaves Lansdown said: ‘Centrica’s full year results are resilient in the context of a very challenging environment, which is reassuring in the circumstances.

The CMA said last July that households were overpaying suppliers for their energy by around £1.2 billion a year and failing to switch to get the best deals.

However, it appears more customers are voting with their feet after British Gas sad it lost 119,000 accounts over the a year ago.