Energy consumer body Consumer Focus has joined forces with MPs in calling for an investigation into whether energy companies are failing to pass on reductions in wholesale energy prices to gas and electricity customers.
It has backed an Early Day Motion tabled yesterday by John Grogan MP calling for the Competition Commission to hold a thorough inquiry into the workings of the energy market. It has also written to all MPs asking them to back the motion.
Energy market ‘broken’
Consumer Focus says there is room for significant price cuts from energy companies like British Gas, Npower, Eon, Scottish Power, EDF, and Scottish and Southern Energy, and has called on them to lower their prices and pass on cuts in full so that consumers get a fair deal.
Energy expert for Consumer Focus, Robert Hammond, said: ‘Millions of people are paying over the odds to heat their homes this winter, despite huge falls in the wholesale price of gas. Yet none of the big six energy companies are breaking ranks and passing on lower wholesale costs to their mainstream customers.
‘The energy market is broken and will not fix itself. The Competition Commission is the resource available to regulators and government for such a failed market. A detailed examination by competition experts is the way to identify the necessary remedies and the steps to implement them.’
Lack of transparency
Which? policy advisor, Dr Fiona Cochrane, said that a lack of transparency over energy pricing was driving the perception that costs are not fair.
‘This perception is exacerbated when there are increases and decreases in energy costs, the reasons for which do not appear to be consistent, and when the profits of energy companies are announced and appear to be very large. At the moment it is next to impossible for experts – let alone the average consumer – to assess whether this perception has a basis in reality,’ Dr Cochrane explained.
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