This news comes less than a week after British Gas, Britain’s biggest energy company, revealed a 24% increase in profits
uSwitch research has found that the cost of energy price rises to customers totals £630 million, adding to financial pressure on a nation already buckling under the effects of inflation.
Almost 28 million customers have been affected by the latest round of gas and electricity price rises; the average annual bill went up by an average of 5.9% or £63 to an eye watering £1,132 a year.
All six of Britain’s major energy suppliers implemented a price increase this winter, with the total averaging 5.6% or £35 for gas and 6.4% or £28 for electricity.
EDF Energy was the last of the energy suppliers to enforce a price rise – its hike of 6.5% for gas and 7.5% for electricity comes into force today.
The research comes just days after British Gas announced a 24% increase on year-on-year profits, up from £598 million to £742 million.
Industry regulator Ofgem is currently investigating the spate of price rises as well as transparency around practices in the sector.
In November of last year it was estimated that net profit per dual fuel customer had soared from £65 in September to £90, a total rise of 38% over a three month period.
Customers are now paying £313 or 38% a year more for their household energy than at the beginning of 2008.
However, the difference between the cheapest energy plan and the most expensive now stands at £316 a year, meaning that customers could pay 2008 prices by switching to the cheapest gas and electricity supplier in their area.
Average gas and electricity bills since 2008
Ann Robinson, Director of Consumer Policy at uSwitch, said EDF’s price rise would be unwelcome, but did not strike at the worst time: “March marks the end of a round of energy price hikes that brought misery to British households this winter.
“EDF Energy will become the last of our big six suppliers to increase its prices, but at least by holding off until March it protected its customers through the coldest months.
“Unfortunately the same cannot be said of its rivals and as a result profits and price hikes will be on Ofgem’s radar as it looks to shake the market up.”
Ofgem is expected to reveal its findings sometime this month, when it will be under pressure to implement some changes to the industry.
There are several steps Ofgem may take depending on their findings; these include taking no action, reviewing industry regulations or possibly calling for a full investigation by the Competition Commission.
The results of, Ofgem’s enquiry are highly anticipated, said Robinson: “The results of Ofgem’s investigation cannot come too soon.
“With only around 3.5 million or one in ten households (13%) on suppliers’ cheapest energy tariffs, consumers really need to start using the competitive market to help themselves.
“Anything that Ofgem can do to give more people the confidence to do so has to be welcome.
“This winter’s price hikes have opened up an opportunity for consumers to turn the clock back on their energy bills…I would urge anyone who hasn’t yet ditched their old fashioned and expensive standard tariff to do so now and move to a competitive online plan instead.
“In a time of rising prices our best defence is to use less energy and to pay the lowest possible price for what we do use.”
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