Anti-poverty campaigners rage as energy giants rake in cash

Feb 16, 2023, 7:42 AM | Updated: 7:46 am
FILE - Protestors from Fuel Poverty Action group hold placards as they demonstrate over the number ...

FILE - Protestors from Fuel Poverty Action group hold placards as they demonstrate over the number of excess deaths in Britain due to pensioners unable to heat their homes in winter due to rising fuel costs outside Downing Street in London, on Jan. 19, 2023. Anti-poverty campaigners fumed Thursday Feb. 16, 2023 after the parent of Britain’s biggest home energy supplier said earnings more than tripled last year as consumers struggled to pay soaring utility bills. (AP Photo/Alastair Grant, File)

(AP Photo/Alastair Grant, File)

LONDON (AP) — Anti-poverty campaigners fumed Thursday after the parent of Britain’s biggest home energy supplier said earnings more than tripled last year as consumers struggled to pay soaring utility bills.

British Gas owner Centrica followed Shell and BP as the latest U.K.-based energy company to rake in massive profits after oil and natural gas prices surged as the result of Russia’s invasion of Ukraine. That sparked renewed calls from the opposition Labour Party for an expanded tax on those companies’ windfall profits.

Centrica said adjusted operating profit jumped to 3.3 billion pounds ($4 billion) in 2022 from 948 million pounds the previous year. That was good news for shareholders, with the company announcing plans to boost an existing share buyback program by 300 million pounds and pay dividends totaling 59 million pounds, compared with nothing in 2021.

The earnings came just two weeks after an investigation by the Times of London found that a debt collection company working for British Gas had broken into the homes of some people who were unable to pay their bills this winter and installed meters that require customers to pay for energy in advance.

Centrica officials apologized, said they were unaware of the contractor’s behavior and suspended the practice.

“The profits of this firm are built on the backs of older people, young families and the disabled suffering in cold, damp homes this winter,” said Simon Francis, coordinator of the End Fuel Poverty Coalition.

Centrica is both a wholesale energy producer and a retail supplier.

The company said most of its earnings came from energy trading and marketing, as well as its nuclear power operations. By contrast, operating profit at the retail British Gas Energy unit fell 39%, to 72 million pounds.

British Gas is the U.K.’s biggest residential energy supplier, with more than 7.5 million customers across the country.

Centrica said it was “acting responsibly through the energy crisis,” providing 50 million pounds of support for customers and pledging to donate 10% of British Gas profits to help protect vulnerable customers.

“Therefore, we were extremely disappointed by the allegations surrounding one of our third-party contractors and their approach to pre-payment customers,” Centrica said. “We immediately took action to address this and are completing a thorough independent investigation.”

Britain has been hard hit by the high cost of natural gas because limited storage capacity left energy suppliers at the mercy of international markets as prices soared.

That contributed to double-digit inflation that has fueled a wave of public-sector strikes, soaring food bank use and the biggest drop in living standards since records began in the 1950s.

The government tried to ease the pain with subsidies designed to limit average household energy costs to no more than 2,500 pounds a year, a figure that will rise to 3,000 pounds on April 1. Even with that protection, the average household bill has almost doubled in the past year.

Centrica acknowledged that more needs to be done to protect customers.

“We believe a fundamental review of energy regulation is required to ensure the system is ready for the energy transition, works for consumers and allows well-run suppliers to make an appropriate return to compensate for the risks taken,” the company said.

Britain’s Conservative-led government last year imposed an additional 25% tax on the profits that oil and gas producers make from their U.K. operations. The tax increased to 35% on Jan. 1.

On top of that, the government approved a 45% tax on the “exceptional” profits of wholesale electricity producers that took effect this year.

The Labour Party called on the government to immediately expand the windfall tax on oil and gas producers to provide more help for consumers. The party has criticized the government for allowing energy companies to reduce their tax payments with investments in the U.K.

“In a matter of weeks, another spike in energy prices will hit families,” Rachel Reeves, Labour’s spokesperson on Treasury issues, tweeted after Centrica’s earnings. “The government must bring in a proper windfall tax on oil & gas giants to stop energy prices rising in April.”

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


Haitian migrant Gerson Solay, 28, carries his daughter, Bianca, as he and his family cross into Can...
Associated Press

US, Canada to end loophole that allows asylum-seekers to move between countries

President Joe Biden and Canadian Prime Minister Justin Trudeau on Friday announced a plan to close a loophole to an immigration agreement.
3 days ago
Expert skateboarder Di'Orr Greenwood, an artist born and raised in the Navajo Nation in Arizona and...
Associated Press

Indigenous skateboard art featured on new stamps unveiled at Phoenix skate park

The Postal Service unveiled the “Art of the Skateboard" stamps at a Phoenix skate park, featuring designs from Indigenous artists.
3 days ago
(Facebook Photo/City of San Luis, Arizona)...
Associated Press

San Luis authorities receive complaints about 911 calls going across border

Authorities in San Luis say they are receiving more complaints about 911 calls mistakenly going across the border.
9 days ago
(Pexels Photo)...
Associated Press

Daylight saving time begins in most of US this weekend

No time change is observed in Hawaii, most of Arizona, Puerto Rico, the U.S. Virgin Islands, American Samoa, Guam and the Northern Marianas.
17 days ago
Mexican army soldiers prepare a search mission for four U.S. citizens kidnapped by gunmen in Matamo...
Associated Press

How the 4 abducted Americans in Mexico were located

The anonymous tip that led Mexican authorities to a remote shack where four abducted Americans were held described armed men and blindfolds.
17 days ago
Tom Brundy points to a newly built irrigation canal on one of the fields at his farm Tuesday, Feb. ...
Associated Press

Southwest farmers reluctant to idle farmland to save water

There is a growing sense that fallowing will have to be part of the solution to the increasingly desperate drought in the West.
24 days ago

Sponsored Articles

(Photo: OCD & Anxiety Treatment Center)...

Here’s what you need to know about OCD and where to find help

It's fair to say that most people know what obsessive-compulsive spectrum disorders generally are, but there's a lot more information than meets the eye about a mental health diagnosis that affects about one in every 100 adults in the United States.
Day & Night Air Conditioning, Heating and Plumbing

Prep the plumbing in your home just in time for the holidays

With the holidays approaching, it's important to know when your home is in need of heating and plumbing updates before more guests start to come around.
(Desert Institute for Spine Care photo)...

Why DISC is world renowned for back and neck pain treatments

Fifty percent of Americans and 90% of people at least 50 years old have some level of degenerative disc disease.
Anti-poverty campaigners rage as energy giants rake in cash