by Trevor Loveday
Suppliers’ claims that higher costs justified recent increases in consumers’ electricity and gas bills have left some unconvinced.
Consumer Focus questioned assertions by energy suppliers that wholesale price increases and network and government policy costs were behind recent hikes in consumers’ bills. “We can’t be confident that price increases are driven by underlying costs,” said Consumer Focus head of energy regulation Richard Hall. He said Consumer Focus saw suppliers’ costs falling and the cost outlook for suppliers “was not sufficient to justify recent price rises”.
“If we are right, then suppliers may not be being entirely truthful,” Hall said.
Energy regulator Ofgem predicted last week that suppliers’ margins would increase by more than 50 per cent to £65 a customer over the next three months, due to increased bills to consumers and “lower wholesale and other costs”.
Debt bounce expected
This year could be the worst for numbers of people falling into debt with energy suppliers, the Money Advice Trust has warned. “We expect 2012 to represent the biggest year-on-year jump in energy debt calls,” said chief executive Joanna Elson.
Last year, the trust fielded more than 25,000 calls about debt related to energy bills. Ofgem last week published figures for 2011 showing a small drop in numbers of people in energy debt.
This article first appeared in Utility Week’s print edition of 19th October 2012.
Get Utility Week’s expert news and comment – unique and indispensible – direct to your desk. Sign up for a trial subscription here: http://bit.ly/zzxQxx