There are renewed calls this week for Ofgem to end the “stranglehold of the big six energy suppliers” following the publication of Centrica’s first half results.
In the period to June 30, Centrica, the parent company of British Gas, pulled in revenues of £11.7bn and earnings of £886m.
Robert Hammond, energy expert for watchdog Consumer Focus, said: “Many customers will see these figures as a slap in the face considering the recent meagre price cuts. With over five million households in fuel poverty, but millions in profits still being made, the energy market is clearly working for shareholders but not consumers.
“Ofgem must now force energy companies to end the unfair pricing penalties facing vulnerable households and ensure that declining wholesale prices are being fully passed on to customers.”
M&C Energy Group, one of the UK’s largest purchasers of energy, believes that energy companies will not delay passing on any increases in fuel costs in the coming months.
M&C’s energy analyst David Hunter said: “The real frustration is that it is a win-win situation for the major energy companies. If wholesale energy prices are high, the production side of the business flourishes, meanwhile the supply side of the business benefits if fuel costs are low. After the coldest winter in 30 years, it is no surprise that British Gas are reporting doubled profits.
“The stranglehold of the big six energy suppliers is cutting off any real competition in the market. M&C is calling on Ofgem to step in to protect consumers from the impact of lack of competition in the market, and review their monitoring of supplier margins in light of these enormous profits. The suppliers are ignoring the laws of gravity in their prices, and hard-pressed homes and businesses have to pick up the tab.”