Energy bills: Big six firms slammed for overcharging customers
The energy regulator, Ofgem, has slammed the UK's "big six" energy companies for failing to pass on cheaper wholesale costs to customers.
Dermot Nolan, the the head of Ofgem, said wholesale energy costs have fallen by about a third in the last 12 to 18 months.
Despite this, the big six energy companies – British Gas, Npower, SSE, Scottish Power, E.On and EDF – are yet to announce a corresponding cut in retail prices. Nolan said this was because the market isn't working as competitively as it should be.
In an interview on BBC Radio 4's Today programme, he said: "The biggest component of your energy bill is the wholesale cost – it's approximately half the bill, maybe a shade under … it has fallen by nearly a third over the last year to year-and-a-half."
"We really should be seeing bigger retail cuts than we have seen so far."
Figures released yesterday showed wholesale energy costs in the UK hit a five-year low at the end of 2015.
Earlier this week, Ofgem came under fire after a newspaper editorial in The Times accused it of being too soft on the industry.
Nolan hit back saying: "Yesterday's leader claimed that Ofgem was too soft on the industry while producing no convincing evidence to support the case. The facts tell a different story."
Ofgem has imposed over £200m in penalties on the industry since 2010 – £40 million of this for misselling."