British Gas owner Centrica will increase the base salary of its chief executive, Chris O’Shea, to £1.1 million for 2025, despite ongoing scrutiny over executive pay and a recent slump in profits. The move comes after nearly 40% of Centrica’s shareholders voted against the board’s pay plans at last year’s annual investor meeting, according to the company’s latest remuneration report.
O’Shea’s total remuneration for 2025 is expected to reach £4.7 million, including a £1.4 million bonus – half of which will be paid in shares vesting over three years – and £2.2 million from the company’s long-term investment plan. This follows a 2023 pay packet of approximately £8 million, which drew criticism as many UK households struggled with fuel poverty during the energy crisis.
Centrica acknowledged the “mixed shareholder feedback” regarding last year’s pay increase, stating it would “continue to engage regularly” with investors on executive compensation. The company believes it has established a framework that “reflects stakeholder expectations and rewards the long-term success of the group.”
The pay increase coincides with a reported fall in profits for the year, attributed to warmer weather reducing energy demand and a rise in customers opting for fixed-price energy deals. Adjusted profits fell to £309 million for the year, down from £364 million the previous year, despite a 1% increase in household customer numbers to almost 8 million accounts. Overall retail profits remained flat at £557 million, boosted by earnings from energy services and business solutions.
Centrica has also suspended its share buyback program, leading to a 5% drop in its share price. The company intends to redirect investment towards areas expected to deliver more stable returns, including nuclear power, carbon capture, and gas storage. Adjusted earnings for 2025 totaled £1.42 billion, a significant decrease from the £2.3 billion reported the prior year.
“The environment has been challenging, and performance has varied across the business,” O’Shea stated. Geopolitical volatility impacted energy trading earnings, and outages in the UK’s nuclear reactor fleet, in which Centrica holds a minority stake, also contributed to the decline.
Centrica is investing heavily in new energy infrastructure, including the Sizewell C nuclear plant in Suffolk and a potential fleet of advanced modular reactors (AMRs) developed with X-Energy in the US. The company also acquired Europe’s largest gas import terminal at Grain LNG for £1.5 billion and is considering further investment in its Rough gas storage facility.
The future of the Rough gas storage site remains under discussion with the government. O’Shea previously indicated the site might be forced to close without financial support, as it has struggled to generate profits in recent years despite reopening in 2022 during the European energy crisis. As European gas market prices have cooled, the facility has faced renewed financial pressure.
O’Shea outlined the company’s strategy as supporting the energy transition while achieving “stable and predictable returns,” describing 2025 as a “turning point” and anticipating further progress in 2026.
