Half of the big six energy suppliers are losing money on their domestic electricity and gas supply business, according to the latest financial data published by the companies.
Npower, EDF Energy and Scottish Power all posted losses on their domestic electricity and gas retail businesses, while Eon recorded a loss on its domestic gas supply. However, all the major energy suppliers made profits on non-domestic electricity and gas, as well as in power generation.
Scottish Power reported earnings before interest, tax, depreciation and amortisation (Ebitda) of -£128 million for domestic electricity and -£118 million for domestic gas. Npower posted losses of £11 million (domestic electricity) and £5 million (domestic
gas), while EDF Energy recorded losses of £19 million (domestic electricity) and £66 million (domestic gas).
EDF Energy attributed its losses to a “very competitive market” and the fact that it is smaller than its rivals. The company said its domestic and non-domestic businesses were run independently and “there is absolutely no strategy to subsidise one for the other”.
Npower, which has not posted a profit on domestic supply in the past three years, also blamed an increase in fixed costs in supplying energy, such as environmental and social obligations.
RWE Npower group chief executive Volker Beckers said: “It is clear that there is a large mismatch between the reality of business seen by those in the energy sector and the received wisdom outside it.”