Are energy companies ripping us off?
It goes without saying that energy companies in the UK have been charging everyone a lot of money in their bills, and there's a good chance they've been overcharging too. Legally, we leave the latter statement ambiguous, but you get where we're coming from.
Ofgem, who are looking into all this, has referred the entire energy market to the Competition and Markets Authority, because there needs to be a formal investigation over the prices that everyone is paying. Are they artificially high?
Someone thinks so.
All eyes are on how much money is being made, and concerning SSE, they've seen profits shooting up by 40%, leaving everyone to wonder how they managed it. Of course, they're not alone and data from Ofgem shows that (click here to see Ofgem's lengthy report, complete with some graphs).
The Indy decided to crunch some of the numbers and statistics and came up with their own graph, which is more digestible.
Basically, the energy companies get £120 from your combined gas and electricity charges every year, which is up from 2009's figure of £10. That's a big ol' jump. The problem is that The Big Six have lowered their prices, but no nearly as much as the drop in wholesale prices. If you look at gas, bills have fallen by a couple of percent, while the cost of the companies buying it has dropped by 20% - the savings are not being passed on.
An Ofgem spokesperson says: "Falls in wholesale energy prices have resulted in significantly better deals for consumers on fixed tariffs but the majority of consumers who are on standard variable tariffs do not appear to have benefited to the same extent. We look forward to seeing the CMA's draft findings and recommendations in the coming weeks."