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Energy Bills: EDF Still 'Makes Loss'

(c) Sky News 2013

One of the so-called 'big six' energy firms has said it is still selling gas and electricity to households and businesses at a loss, despite huge rises to bills.

EDF Energy said its best nuclear power generation performance for seven years helped restrict a fall in profits for 2012 to £801m from £894m in the previous 12 months.

The company insisted that despite its annual average dual fuel bill now costing its 3.7 million residential customers £1,332, it was not making a profit in its residential supply arm.

EDF (Paris: FR0010242511 - news) said it had invested £1.3bn in its existing nuclear and coal stations, new generation capacity, gas storage and in its customer supply business, representing a £200m increase on 2011 while nearly £400m was spent on paying income tax and investment in employee pension schemes.

EDF, along with its UK competitors, raised household bills substantially ahead of winter - by 10.8% on average in EDF's case.

All the companies cited rising costs for wholesale gas.

The energy regulator Ofgem declared earlier this week that EDF was the most complained-about of the 'big six' during the final quarter of 2012.

It received 8,072 complaints for each 100,000 customers - more than double the number logged for the second most complained-about firm, nPower.

In March last year its sales tactics came under fire after Ofgem found the group's staff had been making misleading claims to customers, leading to a £4.5m settlement.

But while the company has acknowledged rising complaint numbers over the past year, it insists its efforts to tackle the issues are now having an effect.

A spokeswoman said: "We recognise that last year our customer service levels were not up to the high standard we expect and our customers deserve.

"However, we're pleased to report our service levels have improved significantly over the last six months and our new systems are delivering clear benefits to our customers through clearer, more accurate bills and the introduction of better online services."

Commenting on the financial results, chief executive Vincent de Rivaz said: "Our financial performance last year enabled us to make significant investments in both our existing power stations and our plans for new nuclear stations in the UK, which will help keep the lights on in future with reliable, secure and low carbon energy."

It announced in December it was extending the lifespan of its Hunterston and Hinkley Point nuclear plants by seven years to 2023.

The group is currently in talks with the UK Government over investment for a new multi-billion pound nuclear reactor at Hinkley Point in Somerset, which is expected to cost around £7bn.

It also plans to build a reactor in Sizewell, Suffolk.

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