Energy company Npower has posted a rise in profits of 25% in 2012, just four months after it increased prices for UK customers by 9%.
Npower said that profits reached £390m in 2012, compared to £313m in 2011. This works out as a profit of around £60 for each of the 6.5m households the company provides energy to.
Switching energy tariffs is one of the best ways to deal with rising energy bills – compare gas and electricity prices with Which? Switch to see if there’s a cheaper tariff out there for you.
Spiralling energy costs
Commenting on Npower’s increase in profits, Which? executive director Richard Lloyd said: ‘At a time when spiralling energy bills are consumers’ top financial worry, people are bound to question whether they’re paying a fair price when they see a 25% profit increase from one of the big six energy companies.
‘The Prime Minister promised that energy suppliers would have to put their customers on the cheapest tariffs but Ofgem’s recent proposals for simpler tariffs do not go far enough to keep prices in check. The Government should take more radical action to provide not just simpler but fairer bills.
‘Prices will only be kept as low as possible if there is more effective competition and switching between energy companies. For this to happen the price of every tariff should be presented in a clear, consistent and simple way, through single unit prices like those for petrol and diesel, so people can easily spot the cheapest deal – not just with their current supplier but across the market.’
Profits rising across the market
Npower’s profit announcement comes after British Gas and EDF Energy also recently announced that profits were on the rise. The owner of energy giant British Gas had residential profits of £606 million in 2012, an 11% rise on the previous year, while French-owned EDF posted a 7.5% rise in profits.
Npower came bottom of our latest energy company satisfaction survey. Read our Npower review to find out how its energy prices have changed over time and why Npower’s customers rated it poorly.
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