Energy watchdog Ofgem has come under fire for not increasing the general competitiveness of the UK’s gas and electricity market. Many see this lack of competition as one of the main drivers behind inflation busting energy price increases.
Each of the big six energy suppliers again increased prices last winter, and despite government led cuts to green levies, the average consumer is paying roughly £50 more for energy than last year.
It is estimated that the big six currently supply close to 95% of the British population, although many consumers switched to a small supplier following the latest price hikes.
Independent providers such as First Utility and Ovo Energy are currently offering the cheapest gas and electricity plans on the market.
Market share remains much the same
According to figures released by the Department of Energy and Climate Change (DECC), the gas and electricity market has changed little in the past five years.
E.ON, npower and SSE all have exactly the same share of the gas market as they did five years ago, which stands at 13%, 12% and 15% respectively. British Gas lost 4% of its total share of the gas market between 2007 and 2012, leaving it at 40%. EDF Energy gained 2% during the same time period and in 2012 had 9% of total market share.
The situation is much the same in terms of electricity, where during the same period British Gas moved from 22% to 25% of the total market share. E.ON dropped 15 and EDF Energy and ScottishPower both kept their shares at 13% and 12% respectively.
Calls for energy market reform
Shadow Energy Secretary Caroline Flint has called for a reform of the energy market and said that should Labour win the general election, energy companies would be broken up.
Speaking on Labour’s proposals, Flint said: “Our plans will break up the big energy companies, put an end to their secret deals and make tariffs simpler and fairer. And until these reforms kick in, we will put a stop to unfair price rises by freezing energy bills until 2017, saving the average household £120.”
A report published by Energy UK has, however, pointed out that over the past 15 years the number of small energy suppliers on the market has risen from eight to 15.