Bord Gáis signals further price cuts despite dip in profits

Bord Gáis Energy may cut prices further following 2023 reductions that knocked almost €1,000 annually off some bills.

The electricity and gas supplier said on Thursday that profits fell more than 90 per cent to €2 million last year as it stepped up investment in the Republic.

Its financial results highlighted that it cut €962 from the average combined dual-fuel household gas and electricity bill last year through two price reductions.

Regarding the scope for further price cuts in 2024, it said it would “pass on further savings to customers once we are in a position to do so”, adding it strove to keep rates as competitive as possible.

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Its remarks came just days after Flogas Energy announced reductions of up to 25 per cent, bringing some customers’ gas and electricity bills down by about €700.

Irish energy companies began lowering electricity and gas charges toward the end of last year following months of sustained drops in wholesale prices.

Meanwhile, Bord Gáis said it hoped two gas-fuelled power plants it is building in Athlone and Dublin at a cost of €300 million will begin generating electricity next year.

Both are “peaking plants” designed to switch on and off quickly so they can be called on to supply electricity during times when demand is high.

National grid operator EirGrid recently blamed an absence of new gas-fired power plants for a squeeze on electricity supplies the State company predicted the Republic faced into the next decade.

Bord Gáis said its customer-supply business faced pressure on prices during 2023, while its electricity generation and trading activities performed strongly.

The €2 million profit the company reported was €34 million less than in 2022. The company noted that it continued to invest in the Republic last year.

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This included the new power plants and adding €3 million to an emergency fund to aid vulnerable customers, bringing the total to €7 million since it started in 2022 as the energy crisis deepened.

Continued spending on customer service cut the number of complaints during the year, Bord Gáis said.

Owned by British utility Centrica, Bord Gáis supplies electricity and gas to homes and businesses and generates and trades power.

Managing director Dave Kirwan said the company continued to support customers through the energy crisis.

“We are very conscious of the challenge Ireland faces on energy security and are investing significantly in our hydrogen-ready 100-megawatt flexible gas peaking plants in Athlone and Dublin,” he said.

Centrica reported that its adjusted profit fell to £2.8 billion (€3.3 billion) before tax in 2023, compared with £3.2 billion the year before.

Adjusted operating profit in the business’s retail division, which includes Bord Gáis but mostly consists of British Gas, soared from £94 million in 2022 to £799 million last year.

This was because British energy regulator Ofgem allowed the business to recover £500 million in costs that it ran up during the energy crisis sparked by Russia’s invasion of Ukraine two years ago.

Centrica chief executive Chris O’Shea said the company was pleased to report a strong underlying performance from last year had continued into early 2024.