Energy minister Ed Davey has written to the regulators questioning high profit margins on retail gas, and demanding an investigation: reported by the BBC, Independent and others.
It is suggested that if gas margins were similar to those for electricity, this could save the typical household £40 per year. The letter suggests that British Gas/Centrica prices and profits suggest a monopoly position.
The full text of the letter is here, and you can read more of our coverage of energy prices here.
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4 Comments
So that’s a ‘rip-off’ of less than £1 per week then.
Tell me, how much tax is the government adding to our energy bills?
Who are the rip-off merchants here?
I suppose we shouldn’t complain too much, because Davey is only doing what has been established practice, for decades in politics. Which is, as a minister, you can ‘bark’ at the corporate authorities, but don’t ever bite. And post ministerial career, you will very likely get rewarded with consultancies and directorships of said relevant authorities.
Such is politics. Corrupt, with an inevitable but tiny ‘c’.
Cynical you say ? Perhaps, but history is littered with facts that show I’m right.
widescreen2010 10th Feb ’14 – 11:29am
So that’s a ‘rip-off’ of less than £1 per week then.
Tell me, how much tax is the government adding to our energy bills?
The straight answer to this question is that less than £1 per week is probably a lot less than all electricity and gas consumers will be forced to pay on top of their existing bills to subsidise new nuclear at Hinkley C.
And if you do not know where Hinkley C is look at the map for where The River Parrett reaches the sea,. Yes that the same River Parrett you have heared mentioned in connection with the flooding of Somerset for the last 4 weeks.
Great place to store nuclear waste for eternity?
How many hours do we need to spend switching providers to save £40 per year ?
Will we in practice be working for less than the minimum wage?
“However one of the long standing concerns about the current energy supply market is that the current Big 6 energy suppliers still see their role as selling gas and electricity rather than having a different business model where the value proposition is to save households energy.” [see full text of Ed Davey’s letter]
Surely, this won’t change until the energy suppliers get incentives to save households energy?
The trick that needs to be pulled off is creating a formula where energy suppliers get paid more for pro-actively reducing the amount of energy a household consumes, whilst households get charged more for increasing the amount of energy consumed, all whilst not locking households into a specific supplier. Thereby aligning consumers and suppliers interests in reducing energy consumption.