In the last year wholesale gas prices have fallen by 38%, and wholesale electricity prices have fallen by 23%. Yet, average dual fuel bills have risen by 7%. The regulator Ofgem has asked for an explanation.
Dermot Nolan, the new chief executive of Ofgem, has written to the Big Six to say he expects suppliers to pass on savings in wholesale costs to customers as soon as possible. If this doesn’t happen, Mr Nolan warns that ‘it could be seen as further evidence that competition is not working for consumers as well as it should be’.
The letter then calls on suppliers to explain to customers how the changes in wholesale prices impact their pricing policies.
Suppliers must rebuild trust
It’s about time the Big Six justified why falling wholesale prices have not had any impact on your bills. With most consumers believing that suppliers put profits before customers, the Big Six have a huge job to do to rebuild trust.
We want to see suppliers behaving fairly and passing lower costs on to their customers. This is why we have been campaigning to Fix the Big Six – big changes are needed and it’s time for the industry to respond.
We’ll be keeping a close eye on the companies’ responses over the coming days and will continue to challenge them on prices as part of our Fix the Big Six campaign.
What do you think about Ofgem’s letter? Has your supplier informed you about falling wholesale prices? How have they done that? If they don’t, will you be looking to save by switching energy providers?