Gas and electricity bills could fall following a meeting between energy ministers and power giants.
Minister for Energy and Climate Change Ed Miliband announced in a written statement yesterday that gas and electricity suppliers and the government are ‘agreed on the need to bring down retail gas and electricity prices’.
Mr Miliband said: ‘I have highlighted the public’s concern about the current high level of retail prices and impressed upon the companies the need for retail energy prices to reflect changes in wholesale prices as soon as possible.’
Oil price link
Last month the government called on gas and electricity companies to cut customers bills following the recent drop in the price of oil.
Oil prices are closely linked to gas prices. Wholesale gas prices also have a large impact on electricity prices because so much of the UK’s electricity comes from gas-fired power stations.
Last week Scottish & Southern Energy (SSE), Britain’s second biggest gas and electricity supplier indicated that it would be able to cut customers’ bills if wholesale prices continued to fall. Now it appears that other suppliers will follow suit.
Following SSE’s announcement, Which? principal economist John Holmes said: ‘Which? welcomes these comments from SSE at a difficult time for consumers and, if wholesale price do continue to fall, we expect that the remaining big suppliers will follow, given their past-behaviour when it comes to raising prices.’
Prices up 38% in a year
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 our satisfaction surveys.
Find the best deal
Which?’s free and independent switching site, Switch with Which?, can help you find the best gas and electricity deals.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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