By Mark Williamson

SCOTTISH Gas owner Centrica has more then doubled annual profits amid the surge in gas prices which has left consumers facing huge increases in their energy bills and decimated the sector.

The group’s total underlying profit increased to £948m in 2021 from £447m in the preceding year.

The rise followed a dramatic increase in profits at the group’s North Sea focused oil and gas business, which it is set to exit.

The division grew profits from £90m in 2020 to £663m, following the rise in oil and gas prices that was fuelled by the recovery from the pandemic.

Centrica’s household energy supply arm made £118 million underlying profit in 2021, up 44 per cent from £82m in 2020.

The increase partly reflects the impact of the dramatic rise in gas prices on wholesale markets which has grim implications for householders in the UK.

The regulator increased the cap applied to the bills of millions of customers on variable tariffs by £139 from October to £1,277. The cap is set to increase by a further £694 from April to £1,971 per year.

Gas prices rose sharply yesterday after Russian troops invaded Ukraine.

The price rise could increase the pressure on some suppliers following a period in which more than 25 have gone out of business.

Companies such as Centrica have been appointed by the regulator to take on the customers of firms that ceased trading.

In its results statement Centrica noted: “In the second half, we added 504,000 customers through the SOLR [Supplier of Last Resort] process as a number of competitors ceased trading.” This reversed the loss of 114,000 customers in the first half.

Residential energy customer numbers increased by 344,000, or 5%, in 2021 to 7,260,000. Small business customer numbers increased to 455,000 from 450,000.

Centrica decided to focus on supplying energy to customers under a simplification process launched by chief executive Chris O’Shea in 2020. It has shed 3,000 jobs under that process. It said the majority of the remaining 1,000 roles are expected to be removed in 2022.

In December Centrica said it had agreed to sell its Norwegian oil and gas exploration and production business in deals with Sval Energi and Equinor worth around £560m in total to the group.

Centrica said yesterday that it aims to realise value from its remaining portfolio of assets in the UK , while minimising further investment in oil and gas exploration and development,

The group cautioned: “High and volatile wholesale commodity prices and a changing regulatory environment create a wider range of outcomes than normal for 2022.”

However, it said it is on a “clear path to restart paying a dividend”.