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Last Updated: Thursday, 29 July, 2004, 12:06 GMT 13:06 UK
Centrica warns on the cost of gas
Gas ring
Centrica says no engineers will be affected by the cuts
UK gas bills may go up for a second time this year because of rising energy costs, British Gas owner Centrica says.

The company raised bills by almost 6% in January, but then saw its share of the residential gas market fall to 60% by July from 63% a year earlier.

British Gas still has 12.3 million residential gas customers.

Centrica, which said in June that 850 jobs would go at British Gas, warned that the rest of 2004 could prove "even more challenging".

'Forced to follow'

According to chairman Roger Carr, consumer energy prices could prove necessary across the board as a result of rising gas commodiity prices.

"Oil, gas and power prices have risen to levels we have not seen for many years," he said.

"Once again we have seen actual commodity prices considerably higher than forward predictions, with an even greater impact currently forecast for the second half of the year.

"Some companies in our industry have already responded with consumer price rises and it is very likely, at these levels, that more will be forced to follow."


The announcement was made as Centrica unveiled an operating profit of 600m, after exceptional items and goodwill, for the first six months of the year.

This compares to a figure of 605m for the same period last year.

Centrica agreed earlier this month to sell its AA business for 1.75bn to a group of venture capitalists.

The deal should be completed by September, and comes as Centrica looks to focus on its energy business and One.Tel telecoms operation.

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