Big Six fail to pass on £120 fuel bills cut to customers

ENERGY firms have been condemned for refusing to pass on a 26 per cent fall in wholesale prices to customers who will struggle to keep warm this winter.

Profits at the ‘Big Six’ suppliers – British Gas, SSE, Npower, Eon, EDF and Scottish Power – are soaring as families and OAPs face a nightmare choice between heating and eating.

Wholesale gas prices are down by more than a quarter on last year and the lowest in six years. However, providers have refused to cut tariffs to reflect this reduction, despite a plea from Energy Secretary Amber Rudd and evidence of overcharging discovered by the Competition and Markets Authority (CMA).

Only British Gas has cut bills in recent months – a 5 per cent reduction in August that was tiny in the context of the fall in wholesale prices. Some analysts suggest that the Big Six have the scope to cut the average dual fuel bill, which is currently around £1,100 a year, by at least £120, which is more than 10 per cent.

Just this week, one small provider, GB Energy Supply, launched a new variable rate tariff that costs less than £800 a year for a medium user.

The fall in the cost of gas has been driven by the fact that wholesale prices are tied to the cost of oil, which is down sharply, and a glut of Liquefied Natural Gas (LNG) on the global market.

Ann Robinson of uSwitch.com, said: ‘It’s astounding that the other major suppliers are dragging their heels.

‘Single-digit reductions fall well short of the double-digit drop in wholesale prices. With the global oil surplus expected to continue into 2016, suppliers have no excuses left for refusing to pass on doubledigit bill reductions to hard-pressed consumers.

‘Now is the time for suppliers to respond to the mounting pressure from the Government and consumers before the cold weather starts to bite.’

Before May’s General Election, the big energy companies said they could not cut tariffs because they were worried about Labour’s proposed price freeze. Despite the fact Labour was swept aside, the energy companies have still refused to make any meaningful cuts. The Energy Secretary has twice written to the Big Six saying she expects them to cut bills. There are reports that some of the companies have not even responded to her letters.

The chief executive of Energy UK, which speaks for the industry, Lawrence Slade, said: ‘Companies keep in contact with the Government but the decisions about prices are a matter for individual suppliers.

‘Some bought their energy many months in advance and it takes some time for cuts to work through to bills.’