Energy price row reignited as British Gas profits double

The plans were announced in the organisation’s interim results for the period ended 30 June 2015, which also reported that Centrica group profits fell 3% to £1 billion.

BRITISH Gas owner Centrica is cutting 6,000 jobs as it reports a doubling of profits at the British Gas business in the first six months of the year.

It did not specify where the cuts would come said half of the job losses would be redundancies.

The company said it aims to release £0.5-1 billion of divestment proceeds by 2017 from oil and gas E&P and wind.

Parent company Centrica’s chief executive Iain Conn defended the firm’s stance and said that it would be “very tough” to make profits for the next six months.

The bumper sum is expected to spark fury, coming weeks after the Competition and Markets Authority said suppliers were over charging customers by £1.2billion a year.

However, low prices meant profit at the gas division plunged by 90% to just £48 million, leaving the energy division down 78% at £116 million.

A combination of colder weather, which saw customers use 8pc more gas for heating, and significant falls in wholesale costs contributed to the profit rise.

Gary Smith, national officer of the GMB union, said: “This will be a day of deep concern across British Gas“.

“These are real jobs, skilled jobs and they are being filled by ex-military personnel, a lot of women and of course, young people”.

It signalled that it no longer sees its Canadian operations as core to the business and reiterated plans to sell upstream assets in Trinidad and Tobago.

Centrica will also invest £250 million over the next five years to expand its North American retail business.

“British Gas should again lead by example by making a 5% cut to both standard gas and electricity tariffs, particularly when it is forecasting increased profits”.

Centrica however said nuclear energy is an “attractive investment and remains a useful source of baseload power” for its UK energy supply businesses.

Conn said Centrica had made solid progress in reducing the company’s net debt and strengthening its balance sheet. “Serving our customers is what we are known for, what we are good at and where we already have distinctive positions and capabilities, ” Conn said. “Reflecting all of this, the business only made a small profit in the first half of 2015, significantly lower than in the first half of 2014”, the report states. Its global workforce now stands at 94,000.