The government has stepped up pressure on gas and electricity suppliers to cut customers’ bills following the recent drop in the price of oil.
The government met with power bosses to discuss wholesale gas prices – which are closely linked to oil prices – and told them that any savings need to be passed through to customers.
Wholesale gas prices also affect electricity prices because so much of the UK’s electricity comes from gas-fired power stations.
Wholesale prices drop
Energy minister Mike O’Brien said: ‘We want to see the companies give some indication, as soon as they are able to, about what they are going to do from the fact that we’ve seen the gas wholesale prices start to move in a better direction.’
‘If there are benefits we want to see them feed through not just to individuals who have to pay the bills, but to the economy as a whole, to give it a boost,’ Mr O’Brien added.
John Holmes, principal economist at Which?, said: ‘More transparency is needed to explain the link between the wholesale prices that suppliers face and the price that consumers pay. A recent survey found that only 12% of Which? members thought their supplier had done everything it could to avoid raising prices.’
Energy price hikes
All of the big six gas and electricity suppliers have hiked prices twice this year – meaning household energy bills have increased 38% during 2008 alone. A recent survey by Which? found that customer satisfaction with energy suppliers was the lowest of all industries covered by its satisfaction surveys.
Switch with Which?, the free, impartial switching service from Which?, lets you compare prices and see suppliers’ satisfaction ratings. On average, customers who used Switch with Which? saved £233 in a year, based on figures gathered from October 2007 to March 2008.
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