A new report released by ICIS Heren has highlighted six of the UK’s major energy industry players as failing to cut down prices in gas and electricity for their customers even though wholesale prices have been dropping rapidly.
Energy utilities including British Gas, Npower, as well as E.ON have yet to scale down customer prices despite a decrease in wholesale prices on the energy market. The data collected by ICIS Heren indicates that the current average wholesale price for gas sits at 25.5p per therm from April 1 to present, more than half the cost of wholesale prices in 2008 which were 58.47p per therm. However, despite the drastic drop in the wholesale market, customers of these major energy utilities have not seen a drop in their overall prices for gas and electricity.
A spokesperson for Heren told media that it was surprising that energy companies would not be decreasing utility prices in the wake of falling wholesale costs to the utilities themselves. British Gas had previously cut down its gas prices by a 10 percent margin back in February, and Scottish & Southern followed suit with a 4 percent decrease in March, however the decrease in prices do not accurately reflect the decrease in the wholesale market.
The Energy Retail Association which works for many of the companies indicated in the report said that industry prices accurately reflected the uncertainty of the market at the time. The spokesperson also said that industry prices had decreased in the past year in correspondence with the wholesale market.