Acquisition

Centrica PLC 29 September 2008 Centrica plc agrees to acquire Solar Technologies Centrica plc, the owner of British Gas, today announced that it has acquired Solar Technologies Group Limited ('Solar Technologies') for £2.8 million in cash (including the repayment of debt). The acquisition will enable British Gas to install solar photovoltaic (PV) technology(1) in the UK and will build on its aim of becoming the leading provider of low carbon energy services. Solar Technologies is one of the UK's leading installers of integrated solar PV and renewable energy technology solutions. It is also one of British Gas' technology contractors for Phase 2 of the Low Carbon Buildings Programme (LCBP) and is responsible for many of the major PV installations in the UK, including landmark installations such as London's City Hall. The acquisition of Solar Technologies is in line with British Gas's strategy of investing in low-carbon technologies. The company aims to build a portfolio of technologies that will enable it to meet customer, property and existing system needs with solutions that enable the generation of cheap, reliable and low-carbon energy. In January this year British Gas announced an equity investment in, and development and distribution agreement with, Ceres Power Holdings plc to develop combined heat and power systems for residential properties based on solid oxide fuel cell technology. More recently, it signed a Memorandum of Understanding with Disenco Energy plc that will see both companies collaborating in the development of micro-combined heat and power appliances for larger homes and commercial properties. The government aims to have reduced UK domestic CO(2) emissions by 26 to 32% by 2020 and a binding target of 15% of all energy coming from renewable sources by the same year and these smaller scale renewable technologies have a significant role to play in helping to achieve these aims. Through its Services business, British Gas has unparalleled national installation and servicing capabilities, which will enable it to maximise the opportunity that low carbon technologies present. Recent changes in building planning approval systems and building regulations will further encourage the use of renewable energy in new buildings across the country. Gearoid Lane, Managing Director of British Gas New Energy, said: 'This acquisition is an important step in British Gas putting in place a range of renewable and low carbon energy technologies for our residential, business and public sector customers. These technologies will become increasingly important as the UK implements policies to meet its stretching renewable energy and carbon emissions targets. And with British Gas's energy experts supporting millions of Britain's homes and business, we are uniquely positioned to deliver.' The European Photovoltaic Industry Association believes that photovoltaic energy could provide 12 per cent of European electricity demand by 2020. Early in 2007, the Department for Trade and Industry set up the LCBP Phase 2, which allocated £48 million to be spent on five renewable energy technologies by 2009. The technologies attract a 50 per cent capital cost grant, the main recipients of which are public sector organisations, with a cap at 50kW systems per building and a total of £1 million grant per organisation. British Gas is a framework supplier for the programme. - ends - Notes to editors Centrica plc is making the acquisition through its wholly-owned subsidiary, GB Gas Holdings Limited. (1 )Solar photovoltaic technology describes the conversion of sunlight into electrical energy through thin layers of semi-conductor material. The output is determined by the brightness of natural light available and by the area and efficiency of panels. Enquiries Investor relations: 01753 494900 Media relations: 0845 072 8001

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