SCOTTISHPower increased profits from selling energy to consumers and businesses by 2% last year although the company suffered a 7% fall in overall underlying profits which it blamed on green taxes and increased gas prices.

The Glasgow-based utility made £184.4 million from selling power last year, up £3.9m, from £180.5m, in the preceding year.

The growth in profits followed a 7% hike in domestic energy prices from December 2012. This added £104 to the average annual dual fuel bill for customers on flexible tariffs.

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The Spanish-owned company put prices up by an average 8.6% in December 2013 citing increased energy delivery charges and costs to support compulsory social and environmental schemes.

The increase was partially reversed in January after the Government announced changes to environmental taxes meant to help cut ­average bills by around £50 a year.

ScottishPower said the growth in retail profits was partly driven by an 86,000 rise in customer numbers, to 5,700,000 during 2013.

The company said its retail business had seen the average cost of gas for domestic use increase by 12.5%. Profit margins shrank to 4.4%, from 4.6% in 2012.

But the profit figures may attract attention following repeated criticisms of members of the group of big six energy companies, which includes ScottishPower, for rising prices. The issue has become a political football.

Last month the Competition and Markets Authority announced it would investigate the energy supply and generation market.

ScottishPower said its core power generation ­business made an operating loss of £87m in 2013 compared with a £3m profit in the preceding year, maintaining high gas prices reduced the profitability of gas-fired generating plants.

It booked a £30.8m charges in respect of the Carbon Price Floor, introduced by the Government in April last year as part of official efforts to reduce carbon emissions.

ScottishPower said the division's results underlined the challenges facing the industry when around £110bn of investment is needed in the UK by 2020.

Chief operating officer Keith Anderson said: "It is crucial we have an energy market which commands the trust of the consumer and gives generators and suppliers, the regulatory and political certainty needed to provide the considerable investment in capacity that the UK requires."

He noted ScottishPower invested £1.27bn in UK assets in 2013, up £70m on the preceding year.

The company has planning consents to develop a gas fired power generation plants at Cockenzie in East Lothian and in Kent but does not believe it would be economic to add capacity under current conditions.

ScottishPower, acquired by Iberdrola for £11.5bn in 2007, has to compete for investment with other parts of the group.

Total profits from ScottishPower's operations fell to £801.6m in 2013, net of one-offs, from £858m in 2012.

The company made £111m profit from its renewable energy operations last year, compared with £64.8m in 2012. Profits from its regulated transmission and distribution activities, fell to £581.7m, from £601.9m.