Acquisition

Centrica PLC
                  

             Centrica acquires U.S. home services business

Centrica plc today announced that Direct Energy, its North American subsidiary,
has acquired Residential Services Group Inc. (RSG), a U.S. based home services
business, for a total consideration of $150 million (£83 million) in cash.

RSG is a leading independent provider of plumbing and HVAC (heating, ventilation
and air conditioning) installations and of maintenance services to homebuilders
and homeowners. The locations of its primary operations include the states of
Texas and Ohio, where Centrica currently has over one million energy customers.
It also has a presence in a number of other states which may provide energy
growth opportunities in the medium term.

For the 12 months ended 31 July, 2004, RSG recorded sales of $308.6 million
(£171 million) and EBITA of $24.4 million (£13.5 million). The company currently
employs approximately 2,000 staff and completes more than 200,000 service calls,
and installs over 50,000 new systems, per annum. The acquisition is expected to
be earnings enhancing in its first full year.

The acquisition gives Centrica an opportunity to replicate its successful UK
model by cross-selling home services to its current customer base, which will
reduce churn. It will also enhance organic growth potential by strengthening
Centrica's overall customer proposition.

Sir Roy Gardner, Chief Executive of Centrica said: 'Acquiring an established
home services business enables us to strengthen our position in Texas and Ohio
by replicating our success in the UK and Ontario in creating value by deepening
customer relationships.

'In RSG we are acquiring a first class management team which has also built a
profitable customer base across a number of states, in which there may be
opportunities to cross sell energy in the future.'

Enquiries:

Centrica Media Relations 01753 494085 
Centrica Investor Relations 01753 494900

Notes to editors:

1. RSG, headquartered in Dayton, Ohio, is one of the U.S.'s largest
   providers of HVAC and plumbing services to the residential and
   light commercial markets. The company installs HVAC and plumbing
   systems in new homes as a subcontractor to homebuilders, which
   provides an opportunity to develop a relationship with homeowners
   from the outset, and provides maintenance and replacement services
   to individual homeowners.

2. The transaction is expected to close in the fourth quarter of 2004.

3. In 2002, Centrica acquired Enbridge Services Inc. in Ontario.