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Centrica says 2019 profit to be hit by energy price cap

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British Gas-owner Centrica said its profit this year will be hit by the energy regulator’s tariff price cap.

The company reported a 12% rise in annual group operating profits to £1.39bn for 2018, but described its performance as “mixed”.

“We have been very clear that we do not believe a price cap is a sustainable solution for the market,” Centrica said.

The company also said it plans to sell more businesses this year.

The new energy price cap came into force on 1 January. Ofgem has estimated that the cap will save 11 million people an average of £76 a year.

But Centrica said on Thursday that regulator Ofgem’s tariff cap “is likely to have unintended consequences for customers and competition”.

Typically, the cap means that typical usage by a dual fuel customer paying by direct debit will cost no more than £1,137 a year.

Consumer organisations say that people could save more by switching supplier.

Centrica also said Spirit Energy gas exploration business and nuclear business produced “disappointing” results, it said.

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