Com­pe­ti­tion drives down col­lec­tive prof­its of Big Six

The Daily Telegraph - Business - - Business - By Jil­lian Am­brose

THE col­lec­tive prof­its of the UK’s six largest en­ergy sup­pli­ers have fallen for the first time in four years due to ris­ing com­pe­ti­tion, ac­cord­ing to a mar­ketwide re­port from the en­ergy reg­u­la­tor.

Ofgem’s anal­y­sis has found over­all prof­its for the Big Six dropped by 10pc to £900m last year as they lost their grip on the mar­ket to a new gen­er­a­tion of en­ergy start-ups.

They face fur­ther pain this win­ter as the Gov­ern­ment’s con­tro­ver­sial cap on stan­dard en­ergy prices de­scends on about 11m ac­counts, de­spite signs com­pe­ti­tion in the mar­ket is im­prov­ing.

More than 73 en­ergy com­pa­nies are com­pet­ing to sup­ply gas and power to Bri­tain’s homes, of which a quar­ter have opted for a new en­trant.

Gil­lian Guy, the head of Cit­i­zens Ad­vice, said the ris­ing num­ber of peo­ple opt­ing for new en­ergy sup­pli­ers “un­der­lines why it’s so im­por­tant that Ofgem tight­ens up its li­cens­ing rules”.

“We know some sup­pli­ers en­ter­ing the mar­ket aren’t pre­pared to pro­vide ad­e­quate cus­tomer ser­vice, or aren’t fi­nan­cially ro­bust enough,” she said.

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