Friday, February 10, 2012
The energy price con
I put a press release out earlier this week highlighting the way that the big energy companies are seeking to hoodwink the public with small price reductions in selected products.
Essentially, most of the Big Six energy companies have cut the price of one fuel only. For instance, British Gas has only cut electricity prices, EDF and Scottish and Southern Energy (which is SWALEC where I live) have only cut gas prices.
British Gas has twice as many gas-buying customers as electricity customers. EDF and SSE have many more customers who buy electricity than gas. That does not appear to be a coincidence.
When these companies pushed their prices up, gas and electricity prices rose together. That is not the case when we experience price cuts. Wholesale prices have fallen from their 2011 peak by 19% for gas, and 25% for electricity, and yet we are only being offered a 5% reduction that will come into effect as winter ends, and fuel use falls.
Within a few minutes of posting that press release on my website I was contacted by a PR person for British Gas asking for a meeting, presumably to try and persuade me of how hard done by the energy companies really are. I don't expect that anybody who would come to that meeting will have the authority to change the companies pricing policies.
Now, the Independent has highlighted that whilst more than 5.5 million households are suffering under fuel poverty, many being forced to choose between heating or eating, the Big Six energy suppliers increased their profit margins by 733 per cent in just three months last year.
Average household bills have doubled in the past six years from around £600 a year in 2006 to more than £1,200 a year now.
Campaigners have set up a new petition with the hope that public support will pile pressure on the Chancellor to announce plans for a levy in March's Budget. I have signed it and would urge others to follow suit.
Essentially, most of the Big Six energy companies have cut the price of one fuel only. For instance, British Gas has only cut electricity prices, EDF and Scottish and Southern Energy (which is SWALEC where I live) have only cut gas prices.
British Gas has twice as many gas-buying customers as electricity customers. EDF and SSE have many more customers who buy electricity than gas. That does not appear to be a coincidence.
When these companies pushed their prices up, gas and electricity prices rose together. That is not the case when we experience price cuts. Wholesale prices have fallen from their 2011 peak by 19% for gas, and 25% for electricity, and yet we are only being offered a 5% reduction that will come into effect as winter ends, and fuel use falls.
Within a few minutes of posting that press release on my website I was contacted by a PR person for British Gas asking for a meeting, presumably to try and persuade me of how hard done by the energy companies really are. I don't expect that anybody who would come to that meeting will have the authority to change the companies pricing policies.
Now, the Independent has highlighted that whilst more than 5.5 million households are suffering under fuel poverty, many being forced to choose between heating or eating, the Big Six energy suppliers increased their profit margins by 733 per cent in just three months last year.
Average household bills have doubled in the past six years from around £600 a year in 2006 to more than £1,200 a year now.
Campaigners have set up a new petition with the hope that public support will pile pressure on the Chancellor to announce plans for a levy in March's Budget. I have signed it and would urge others to follow suit.
