Ofgem call for reduction in energy prices

Energy companies are being accused of turning a profit from the cold winter due to the fact that on average each customer is earning the company about £105 in profit.

According to industry regulator Ofgem, this is an increase of about 40% over just three months, and the highest profit level ever since 2004 when records first started to be kept.

Experts also think that this is the most money that energy companies have been able to make since they were deregulated in the 1990s by the Conservative government.

In fact, due to the high increase, almost ten pence out of every pound that customers pay is pure profit for utility companies.

The figures ironically were released with British Gas expecting to show a new set of profits within the next few days.  Due to the fact that the weather reached such cold temperatures in December the annual profits for British Gas may be able to beat the 2007 record of £571m.

Ofgem’s main concern is that companies are now making very high profits while customers are scrabbling to try to pay their bills even with the slight fall in prices over the last year.

Energy and Climate Change Secretary, Ed Miliband, called on suppliers to reduce all bills as soon as they can, with chief executive of Consumer Focus the government watchdog, Mike O’Conner backing him up, stating that while householders are worried about energy bills from this winter, they are going to wonder how their costs have risen while overall the wholesale costs have decreased.