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Do you think the Big Six are out of touch?

energy prices

Our latest analysis of energy prices demonstrates the Big Six energy providers are out of touch with the market with the price gap between their standard tariffs and the cheapest deals on the market almost doubling.

In just a few weeks the Competition and Markets Authority (CMA) will publish its final decision on how to fix the energy market. You may remember that, with your support, we’ve been campaigning for the CMA’s investigation into the energy market for over the past two years to tackle the lack of competition, the sheer number of people paying over the odds for their energy and the limited protection for vulnerable customers.

Energy prices

Well our new analysis has looked at energy prices over the last two years since the CMA started its investigation. It reveals that the gap between the average Big Six and the cheapest on the market has risen from £182 to £329.

That’s a big gap, and it’s been increasing since 2014.

Yet, despite the significant savings available the official figures for switching rates highlight that there’s only been a small increase over the last two years.

So what’s going on? The CMA recently set out its initial thoughts on the energy market and how it intends to fix it, the report highlighted that the cost to consumers of an uncompetitive market stands at around £1.7 billion, a figure that’s rising.

The CMA proposed a range of measures including a central database of ‘disengaged’ consumers open to energy suppliers to contact each other’s customers; a ‘cap’ for customers who have pre-payment meters; a programme of testing by the regulator Ofgem and; the removal of some of the rules surrounding what tariffs energy companies can provide to their customers.

In our opinion, it isn’t clear how the CMA will judge its investigation and proposals as being successful.

Our call on the CMA

That’s why today we’ve set a challenge to the CMA ahead of its final report.

We want to see how the CMA will be evaluating the success of its remedies, as well as how it will make sure vulnerable people who’ve never switched supplier and are overpaying will get better outcomes and pay a fair price.

We also want to see energy suppliers step up and begin to work harder to restore trust in the energy market.

With almost 500,000 of you who’ve joined our call for fair energy prices, there’s a weight of expectation on the shoulders of the CMA. It’s time to deliver.

So what do you think to the energy prices you pay? Have you switched your energy provider recently? How easy did you find it?


Privatisation has introduced competition, but at a cost. We have a significant number of people, including the most vulnerable members of society, paying higher prices, effectively subsidising those who engage with the switching game. We have also also allowed foreign countries to have considerable control over our energy industry, which seems very unwise to me.

I recognise the benefit of competition, but there is no reason why this has to happen at the point of sale. The energy companies could compete for a share in electricity and gas supply and all consumers could pay the same price. That would be fairer than the present system.

E. Gibello says:
10 June 2016

Energy should not be privatised, as Post and other necessities for life These should always be in the hand of an elected( proportional voting system still lacking in UK)Government.

colin brockwell says:
11 June 2016

I agree 100% gibello


If the government were to put away a few billion pounds each year into a re-purchase fund we could probably achieve this in around twenty-five years [with compound interest]. Of course, we would have to forego what that money buys in the meantime.


Hang on a minute – didn’t an elected( proportional voting system then lacking in UK)Government – decide to privatise these industries?

Why should we trust a Government that doesn’t want to own and run these industries to run them efficiently and fairly?

Frank Greaves-Shaw says:
11 June 2016

I don’t get your point at all on having to put awaay billions of pounds to buy back these services.
They got them for a drop down cost and have reaped billions from them since. So it would be quite logical and even legal, to take them back into public ownership at no cost to us..


Yes, Frank, a future government could pass legislation to compulsorily re-acquire all the shares in the companies that provide utility and other essential services [plus a few more that were still in their infancy in the 1980’s like mobile telecommunications or, indeed, barely embryonic like satellite broadcasting]. Having been bought from the original buyers of the privatised companies these shares are largely held now by institutional investors [like pension funds and managed personal investment portfolios] and by foreign companies or governments. Many, and possibly most, of the utility companies are themselves foreign-owned so it would not be straightforward but arguably it is one way of getting on in the world if nothing else matters.

I seem to recall that the money received by the government for the whole privatisation programme was around £30 billion at historic prices – not exactly a “drop down cost” – and some companies have appreciated in value enormously since privatisation so their current market value is very high; but some of the industries that were privatised have little relevance to domestic consumers [so would presumably be outside a buy-back programme] or no longer exist in recognisable form.

I wrote at the beginning “a future government” because such a measure would require a totalitarian regime to sustain it and we do not enjoy such liberty in our present situation.


Further to Frack GS’s post, from my very limited experience of EUlaw in action, I am sure that, without proportionate compensation payments to the current owners, re-nationalisation would be illegal.

Maxximus says:
12 June 2016

The British had the best society due to Socialism, but they became lazy, selfish, greedy and jealous of the ‘haves’. They wanted to become like Americans, so the politicians gave the family silver away to their friends and backers, now we have no remaining British industry because they belong to foreigners.
Blame the ignorant, uneducated, greedy peasants for our predicament, not these companies whose only purpose is to exploit and make profits.


Even if the UK left the EU it would be illegal under UK law so Parliament would have to pass new legislation. That certainly isn’t going to happen under the present government, or even the next one in all likelihood. But irrespective of the legal issues, which lawyers could no doubt ruminate on exhaustively, there is the matter of the effect on the economy and future trading relationships of a country that would dispossess owners of their valuable assets and income streams. As well as other financial services sectors, the life assurance and private pensions industry would be so seriously disrupted that there would be major repercussions against the state and the whole compulsory expropriation exercise would become counter-productive. However desirable re-nationalisation might or might not be, it is not going to solve the present problems in the energy market.


I thought the ‘family silver’ [the gas, electricity, water, telecoms, railways, petrochemicals, engineering, steel, aerospace, and numerous other industries] was largely sold – not “given away” – to private investors who could buy limited numbers of shares each in the initial public offerings. The prices were attractive and quickly appreciated so ultimately the shares were sold on to corporate investors. Personally I put the faults of the utility companies down to slack regulation. The actual profits don’t seem to be particularly impressive as a percentage of turnover but because the ‘big six’ energy companies have complex operating structures that include production it is difficult to unravel the economics for the domestic market. Government obligations, levies and taxes further distort the consumer prices.


The intro says:
“to tackle the lack of competition”
“the cost to consumers of an uncompetitive market stands at around £1.7 billion,”
“the gap between the average Big Six and the cheapest on the market has risen from £182 to £329.”

Well, I would have thought the latter statement demonstrates very clearly that there is competition. Otherwise all prices would be the same, wouldn’t they? What is needed is people taking advantage of this competition. CMA points out that many know they can, know how to, but don’t bother.

Certainly the vulnerable need helping, and should be helped separately.

Be careful, though, how we view these deals. If everyone went for the cheapest deals – generally fixed-price ones – then profits would dip as the extra revenue from “standard” (variable price) tariffs would fall substantially. So these “cheaper” deals would then rise in cost to restore profits . I’d like to see choice in tariffs, clearly advertised, and a central independent (that is, of commmercial motives) comparison site. Simply put in your annual usage, post code, and find the cheapest deals from which you can select the one you want. I’d like someone like Ofgem to offer this. Then no more “selective” comparison sites, no more “commissions” for customers who switch through them.

There are around 40 odd energy companies, larger and small, vying for our business. Some will have lower overheads than others, some will buy better on the forward market, some will produce cheaper energy from their own resources. Transmission costs will be higher to some areas than others. Some pay government levies, the smaller ones get some relief. So have them all forced to charge exactly the same would mean the more efficient suppliers would get a nice profits bonus. I doubt that would go down very well with consumers.

We have choice. Lets keep it and let those who choose to shop around, as for any other purchase, make use of that choice. Just make it easier to switch (already in hand) and give special help to those unable to help themselves. pricing.


“Certainly the vulnerable need helping, and should be helped separately.” So we might help the vulnerable (no certainty about this) so that the companies can go on exploiting them and making profits for the shareholders. That does not seem like a good idea.