Boss of British Gas owner calls for green levies to be scrapped

Boss of British Gas owner Centrica calls for green levies on energy bills to be scrapped to save families £170-a-year – and says firm does NOT want taxpayer funded bailout amid soaring wholesale costs

  • Chris O’Shea, chief executive of Centrica, called for cuts to VAT and green levies 
  • He also called for any green programmes to be funded out of general taxation
  • Mr O’Shea also wrote that British Gas does not want a government bailout 
  • The boss of British Gas owner Centrica has called for green levies on energy bills to be scrapped to save families £170-a-year. 

    Chris O’Shea, chief executive of Centrica, has also said it does not want a bailout from the Government as households prepare for a 50% spike in their bills.

    Mr O’Shea instead called for cuts to VAT and green levies and said they could do more to help customers. He also called for green programmes to be funded out of general taxation.  

    ‘There are reports that some energy companies want a £20 billion handout to keep household bills down,’ he wrote in an opinion piece published in the Sun on Friday. Not British Gas. We haven’t asked for a bailout, we don’t want a bailout, and we oppose any bailouts.’

    Energy bills are set to go up significantly in April. Households will not know exactly how much their bills will rise until next month, but some experts are predicting a hike by around 50%.

    This means that an average household on a supplier’s default tariff will pay nearly £2,000 per year for their gas and electricity, compared to less than £1,300 today. 

    Chris O'Shea, chief executive of Centrica, has called for green levies on energy bills to be scrapped to save families £170-a-year

    Chris O’Shea, chief executive of Centrica, has called for green levies on energy bills to be scrapped to save families £170-a-year

    Mr O’Shea said that if the Government chose to suspend VAT on energy bills, households could save around £100 per year.

    However this will only offset a small proportion of the expected £700 hike in energy bills, and critics say it is a blunt tool that will help both rich and poor households.

    It will deprive the Government of nearly £2 billion that it could otherwise use to help households most in need, some argue.

    Mr O’Shea said that another option would be to remove social and green levies from energy bills and instead have the taxpayer pay for the programmes. This could save customers £170, he said.

    Supporters of the potential £20 billion package say it would insulate customers from such a big shock.

    The price hike is due to soaring global gas prices which mean that energy suppliers have to buy their gas at much higher levels than before.

    ‘Energy suppliers have to pass on higher wholesale costs to survive,’ Mr O’Shea wrote.  

    Jess Ralston, an analyst at the Energy and Climate Intelligence Unit, argued that it makes little sense to slash green levies, when it is the price of gas, a fossil fuel, which is pushing up bills.

    ‘The talk of slashing levies ignores the fact that a significant proportion goes to insulate fuel poor homes and help the elderly cover winter heating bills,’ she said.

    ‘Without a decade of these levies many poorer households would be facing a much more frightening prospect.

    Energy bills are set to go up significantly in April. Households will not know exactly how much their bills will rise until next month, but some experts are predicting a hike by around 50%

    Energy bills are set to go up significantly in April. Households will not know exactly how much their bills will rise until next month, but some experts are predicting a hike by around 50%

    'There are reports that some energy companies want a £20 billion handout to keep household bills down,' he wrote in an opinion piece published in the Sun on Friday. Not British Gas. We haven't asked for a bailout, we don't want a bailout, and we oppose any bailouts'

    ‘There are reports that some energy companies want a £20 billion handout to keep household bills down,’ he wrote in an opinion piece published in the Sun on Friday. Not British Gas. We haven’t asked for a bailout, we don’t want a bailout, and we oppose any bailouts’

    ‘Electricity bills aren’t rising as sharply as gas because early renewable subsidies are paying off, with cheaper wind and solar power cushioning the current high running costs of gas power stations.’

    Customers are also facing the threat of higher shopping bills because companies are passing on the costs of spiralling energy prices. 

    A British Chambers of Commerce survey of almost 5,500 companies found three out of five expect their prices to increase in the next three months.

    Families have been warned domestic gas and electricity bills also could rise as much as 50 per cent in April as the energy price cap is hiked.