Energy Companies’ Reasons For Price Hikes Cast Into Doubt
Official figures cast doubt on claims by the UK’s biggest energy firms that rising wholesale costs are to blame for their inflation-busting price hikes
Consumers have in recent weeks been hit by price rises of up to 11.1 per cent.
A number of the “big six” energy firms have claimed that the increases are because of rising wholesale prices.
However, data from Ofgem, the energy regulator, suggests that wholesale prices rose by only 1.7 per cent over the last year.
The figures, reported in the Financial Times, will prompt fury across the country as homeowners prepare for winter.
According to the analysis, the element of the average energy bill due to wholesale prices would only have gone up from £600 to £610.
However, Ofgem estimates that the energy companies’ average net profit margin has more that doubled over the past year from £45 a household to £95.
Representatives of the companies will face a grilling from MPs in Westminster this week.
It came after David Cameron last week promised to roll back the green levies on household energy bills.
Ed Miliband, the Labour leader, has pledged to freeze energy bills for 20 months if he wins the next election.
Meanwhile, the energy companies have been accused of “gross insensitivity” after claiming that they should not face a windfall tax because their £3.74billion in profits are “not particularly big”.