EDF earnings fall as 80,000 customers leave
15th February 2017 | Residential Energy
Gas and electricity giant (one of the Big Six) has lost 80,000 customers. This has led to a slump in annual UK earnings of 29%, which has been caused by competition from rival suppliers and lower wholesale energy prices.
EDF is increasing electricity prices by 8.4% next month, said that underlying operating profits fell to £470 million last year. This is down from £664 million the previous year. Although it lost 80,000 customer accounts over the year, EDF said that its overall customer base was “broadly stable in an intensely competitive” market at 5.2 million.
The French-owned energy group also revealed that the slump in the pound since the Brexit vote cost is £300 million when UK earnings were translated into euros.
EDF is building the Hinkley Point C power station in Somerset and said UK nuclear production reached its highest level since 2003 last year in an “exceptional” performance. The company is 85% owned by the French government already produces electricity from eight nuclear power stations. However, the Hinkley project will be Britain’s first new station in two decades.
EDF said the rise in nuclear energy generation in the UK came amid an ongoing investment programme that saw it pump £529 million into its existing stations last year. However, the surge in production failed to offset a slump in nuclear prices. EDF was also knocked by lower energy prices across the board in wholesale markets. These have since risen, in particular for UK suppliers due to the impact of the pound’s plunge since the Brexit vote. Providers are hiking tariffs as a result.
EDF is increasing its electricity prices in March, although it cut gas tariffs by 5.2% in January. A number of other suppliers have also recently announce price increases, including ScottishPower and Npower.
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