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Consumer watchdog accuses suppliers of overcharging Consumer Focus claimed today that domestic energy customers are being overcharged by a combined £1.66 billion this year (£74 per household) because declining wholesale costs have not been fully passed on by suppliers. The big six gas and electricity companies have disputed this claim. Analysis published by the consumer champion argued that current gas prices should be at least 7.4% cheaper (£60.10 annually), and electricity bills a minimum of 3.1% (£13.80) lower, if suppliers had fully passed on declining wholesale costs to consumers. The watchdog has called on suppliers to pass on these savings immediately. Philip Cullum, deputy chief executive of Consumer Focus, said: "Consumers have feared for months that the big six suppliers might not have passed on the full cuts in wholesale energy prices, but the companies claimed to have acted fairly. Our new research for the first time shows the reality. The companies are pocketing £1.6 billion extra, while millions of households struggle to make ends meet". Garry Felgate chief executive of the Energy Retail Association hit back, saying the consumer watchdog was being misleading and had ignored key facts on costs in reaching its conclusions. He stated "The energy regulator, Ofgem has repeatedly looked at the issue of energy prices and have concluded there is no evidence of energy suppliers increasing prices faster than they reduce them. If Consumer Focus disagrees with Ofgem's conclusions, then their model and calculations should be made transparent and subject to scrutiny. "Since the start of this year, all the major energy suppliers have reduced prices, and they are investing around £4 billion over the next three years in energy efficient measures - like free and low-cost insulation and home energy audits - helping their customers use less gas and electricity and cut their fuel bills." Source: Utility Week © Faversham House Group Ltd 2009. News articles may be copied or forwarded
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