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Misleading - Energy Company Slam Suppliers Justification for Not Cutting Energy Prices
M&C Energy Group (M&C Energy Group), the UK's largest independent energy consultancy, has called into question the justification put forward by energy companies for not reducing energy prices in line with wholesale falls.
It was hoped that the meeting between members of the Energy and Climate Change Committee and senior figures from EDF Energy, E.On, British Gas, NPower, Scottish and Southern Energy and Scottish Power, would result in further price cuts, but this seems unlikely.
M&C Energy Group, which purchases in excess of £1b of energy each year, called into question comparisons of wholesale energy prices which executives used to justify current energy prices.
According to M&C Energy Group, the prices presented were from a time when energy pricing peaked for a short space of time and not the average over the period.
M&C Energy Group's Business Manager, Malcolm Fraser, said: "The central case presented by executives is that prices have risen 75% in the last two years. The figures are technically correct, but the energy companies have conveniently picked the lowest point in the market for many years as their 'low'. The reality is the trough of February 2007 was very short-lived. Prices in December 06 and June 07 were at or around £40/MWh, and they are at £46/MWh now - an actual rise of less than 15%.
"It would seem that the Select Committee have had the wool pulled over their eyes by the energy companies and we are challenging their justification for current high prices.
"Recent cuts in no way reflect the fall in the market and energy companies cannot justify these prices. We had hoped that suppliers would be made to play fair with their customers and cut prices.
"Scottish and Southern Energy customers have seen their gas bill rise by a staggering 50% and electricity by 36% - offering 4% and 9% discounts from the end of March, which incidentally coincides with SSE's year end, is very disappointing.
"We are in the grip of the coldest winter for many years, yet we are still waiting for four of the big six to announce cuts."
Sandra Birrell, Director, M&C Energy Group added, "Only two of the energy companies have succumbed to consumer pressure and cut costs. When the market was opened up to competition, we were promised real competition. I cannot see that homes and businesses are benefiting from falling wholesale prices. Keeping on top of what is the best energy deal on offer and switching to benefit is time consuming and confusing. It is no wonder that many consumers have given up trying to stay ahead of the pricing game and switching rates have dropped despite high energy costs."
It was hoped that the meeting between members of the Energy and Climate Change Committee and senior figures from EDF Energy, E.On, British Gas, NPower, Scottish and Southern Energy and Scottish Power, would result in further price cuts, but this seems unlikely.
M&C Energy Group, which purchases in excess of £1b of energy each year, called into question comparisons of wholesale energy prices which executives used to justify current energy prices.
According to M&C Energy Group, the prices presented were from a time when energy pricing peaked for a short space of time and not the average over the period.
M&C Energy Group's Business Manager, Malcolm Fraser, said: "The central case presented by executives is that prices have risen 75% in the last two years. The figures are technically correct, but the energy companies have conveniently picked the lowest point in the market for many years as their 'low'. The reality is the trough of February 2007 was very short-lived. Prices in December 06 and June 07 were at or around £40/MWh, and they are at £46/MWh now - an actual rise of less than 15%.
"It would seem that the Select Committee have had the wool pulled over their eyes by the energy companies and we are challenging their justification for current high prices.
"Recent cuts in no way reflect the fall in the market and energy companies cannot justify these prices. We had hoped that suppliers would be made to play fair with their customers and cut prices.
"Scottish and Southern Energy customers have seen their gas bill rise by a staggering 50% and electricity by 36% - offering 4% and 9% discounts from the end of March, which incidentally coincides with SSE's year end, is very disappointing.
"We are in the grip of the coldest winter for many years, yet we are still waiting for four of the big six to announce cuts."
Sandra Birrell, Director, M&C Energy Group added, "Only two of the energy companies have succumbed to consumer pressure and cut costs. When the market was opened up to competition, we were promised real competition. I cannot see that homes and businesses are benefiting from falling wholesale prices. Keeping on top of what is the best energy deal on offer and switching to benefit is time consuming and confusing. It is no wonder that many consumers have given up trying to stay ahead of the pricing game and switching rates have dropped despite high energy costs."
