Big six’s energy price cut behaviour ‘not acceptable’

Energy minister slams gas and electricity companies for not universally implementing £50 price reduction

Gregory Barker

Greg Barker was unaware not all energy companies would be implementing universal cuts

Energy Minister Greg Barker branded the behaviour of four of the big six energy companies as “not acceptable”, following the slow and piecemeal implementation of government led cuts to green levies.

The reduction in green levies should see the average gas and electricity consumer pay about £50 less on their energy bills every year, however, not all of the big six have pushed through the changes to date.

It is worth noting that the cuts will not wipe out this winter’s gas and electricity price rises and most households will see their bills go up by about £53.

Cuts not passed on all customers

In addition, four of the big six – EDF Energy, E.ON, npower and ScottishPower – have refused to pass on the full savings to customers on fixed rate tariffs.

Those on a fixed plan with one of the above four energy companies, will only receive a £12 reduction on their bills this year. The latter is part of the reduction in the Warm Home Discount levy.

Energy companies justified the move, saying that those on fixed plans would still be paying less than those on a variable deal following the cuts. British Gas and SSE customers will all receive the full discount.

Speaking on the BBC’s You and Yours programme, Barker said he did not know that four suppliers were not planning to pass on the full savings and said the behaviour “would not be acceptable”.

Government price cuts and suppliers

The below table illustrates how the big six have implemented government price cuts.

Supplier

Pre-hike bill

Post-hike bill

Hike effective

Bill after levy reduction

Cut effective

Reduction for fixed and variable?

Holding prices?*

British Gas

£1,191

£1,306

23/11/2013

£1,265

1/1/2014

Yes

Yes until Summer 2015

EDF Energy

£1,190

£1,237

03/01/2014

£1,237

N/A

No

Yes until 2015

E.ON

£1,226

£1,240

18/01/2014

£1,240

N/A

No

No guarantee but says  ‘likelihood  has receded for next 18 months’ (Spring 2015)

npower

£1,220

£1,332

01/12/2013

£1,299

28/2/2014

No

Yes, until Spring 2015

ScottishPower

£1,230

£1,325

06/12/2013

£1,284

31/1/2014

Yes, in part**

Yes, until 2015

SSE

£1,211

£1,304

15/11/2013

£1,259

24/3/2014

Yes

Yes, until Spring 2015

Average

£1,212

£1,291

£1,264

Source: uSwitch.com
Based on a medium user consuming 3,200 kWh of electricity and 13,500 kWh of gas on a standard dual fuel tariff, paying quarterly by cash and cheque, with bill sizes averaged across all regions. *Unless there are significant increases in wholesale costs. **Those on a fixed price tariff paying more than standard tariff prices will see a reduction on 31st January. 3% of fixed customers saw a reduction.

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  • goldenblls

    I think this is absolutely disgraceful, although not in the least bit surprising.

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