Energy companies are failing to pass on savings to customers as gas and electricity wholesale prices have come down but customers are still being charged high prices for the utilities that they use. In the UK, wholesale gas and electricity rates are 50 per cent cheaper now than they were 12 months ago, but the average energy bill has remained virtually static with only marginal price reductions offered from the major utility providers.
As a result, the "big six" gas and electricity suppliers: British Gas, E.ON UK, npower, Scottish and Southern Energy, EDF Energy and Scottish Power have all been profiting from the reduced wholesale prices. British Gas has contributed £349 million of profits to parent company Centrica, according to The Daily Mail.
A rise in wholesale prices gives energy suppliers the perfect excuse to raise domestic gas and electricity prices as customers have to share the burden of increased energy demand and a reduced global supply as markets are restricted. However, suppliers are being criticised for not enforcing reverse changes when wholesale prices come down, so the consumer can share the benefit as well as the burden of fluctuating wholesale energy.
Clare Corbett, a spokesperson for consumer body Which? told The Daily Mail: "The energy market is so opaque it's next to impossible to work out if they are being fair. When they go up we are told it's because of the wholesale price, but when they go down we are told there are other aspects to the price."
With gas and electricity prices so high consumers need to look for ways to keep their heating bills down as winter is already unleashing its frosty touch. Using a price comparison site may not force the big six to bring down their prices but it can certainly help you find the cheapest gas and electricity on the market.
Shopping online for your energy will also attract an online discount from most providers, which can be up to 15 per cent cheaper than buying over the phone. These small measures can help make a difference to your energy bill to keep you warm through the winter without breaking the bank.