Huhne calls for consumers to switch energy suppliers

 

Chris Huhne: "Consumers can know that they will get the fair deal as well"

Related Stories

Energy Secretary Chris Huhne has said that people have to check that they are on the cheapest available energy tariff and whether they could save money by paying by direct debit.

He was speaking after a summit with the six biggest power firms, consumer groups and regulator Ofgem.

The summit discussed whether bills were higher because of lack of competition.

The prime minister said that the government needed to work "harder and faster" to bring down energy bills.

David Cameron called for a "trusted, simple and transparent" market.

"We should be checking to see whether or not we're on the cheapest tariff," Mr Huhne said after the summit.

"We should be switching if we're not on the cheapest tariff and taking the opportunity ahead of this winter to really make sure that we're insulating so that we can save money."

'Inconvenient truth'

David Cameron: "We need to make sure that the energy market is competitive"

British Gas, Scottish Power, Npower and EDF have pledged not to raise prices again this winter.

SSE has already said prices will not rise again until August 2012 at the earliest.

However, Phil Bentley, the managing director of British Gas, the UK's biggest domestic energy supplier, warned that prices in the longer term would keep on rising because of the rising cost of gas on the international market.

"We are importing 50% of the gas that comes into Britain and we are having to compete for sources from the Middle East - Japan is importing huge amounts of gas on ships and that was gas that used to come into the UK market," he said.

Analysis

If anybody thought that at the end of today their energy bill was going to come rocketing down, then that absolutely was not the case.

Chris Huhne's argument seemed to be that at the end of the day it's up to us, the consumers, to shop around and we should not expect the government to somehow resolve the issue of high energy prices.

The difficulty is there is a limited number of levers the government can pull because these are private companies - they're not charities.

Chris Huhne has been going around today saying, "They're not the Salvation Army," and that pretty much is the bottom line.

"It is an inconvenient truth that unit prices of energy are going to go up.

"In my opinion unit prices will only go one way unless someone discovers huge amounts of gas and imports it into the UK: the international price for gas I am afraid is going up," Mr Bentley added.

Getting tough

Last month, Labour leader Ed Miliband attacked the "rigged" market in Britain, while Energy Secretary Chris Huhne said he planned to "get tough" with the firms.

Regulator Ofgem has predicted a rise in firms' prospective profit margins from £15 to £125 per customer - figures challenged by the industry.

Ofgem has also announced plans to simplify tariffs in order to allow customers to compare prices more easily.

Last week one firm, SSE, said its power would be sold on the open market rather than going straight to its supply arm.

Experts say if the other five big firms followed suit it could save customers a lot of money.

Reduce wastage

In a joint statement with Mr Huhne on the MoneySavingExpert.com website, Mr Cameron said they could not control volatile world energy prices, "but we can still help people get their bills down".

Ed Miliband: "The energy companies are not giving a good deal, a fair deal"

"The easiest ways to get energy bills down quickly are to get people paying the lowest possible tariffs and to reduce the amount of energy that is wasted," the statement added.

"Our intention is for today's summit to be the start of a much more active engagement with consumers, with us all working harder and faster to deliver an energy market that is trusted, simple and transparent."

But shadow energy secretary Caroline Flint insisted the government's "warm words" wouldn't "heat homes during a bitter winter".

"They're unable to take on vested interests, they won't tackle the spiralling prices imposed by the energy giants, they won't investigate the mis-selling of energy and they won't help the pensioners whose winter fuel payments have been cut," she said.

£1,000 level

The cost of gas and electricity has risen by up to 18% in the past few weeks, with the cheapest dual-fuel deals - for those with online deals - having risen above the £1,000 level for the first time.

This prompted the Department of Energy to call the summit to examine ways in which customers can take action to save money.

But the consumers' association Which? said the meeting should look at more fundamental factors affecting the market.

"We need commitments from suppliers and the government to put an end to practices that harm consumers and action to create a competitive energy market that works for everyone," said executive director Richard Lloyd.

Mike O'Connor, chief executive of watchdog Consumer Focus, said: "Government, energy firms and consumer organisations have a responsibility to make sure that consumers get all the help they need to cut their bills."

Simplification plan

Last week, the regulator, Ofgem, published its simplification plan, which said suppliers would be forced to have no-frills tariffs, which would consist of a standing charge - fixed by the regulator - plus a unit charge for energy used.

It means the only number consumers would have to compare between suppliers would be the unit energy charge.

Ofgem will publish its detailed proposals for consultation next month and hopes to have implemented some of its reforms in time for winter 2012.

A year of energy price rises

Month 2010-11 Company Price rise

Source: Company announcements

November

Scottish Power

Gas: 2% Elec: 8.9%

December

Scottish & Southern

Gas: 9.4%

British Gas

Gas: 7% Elec:7%

January

Npower

Gas & Elec: 5.1%

February

E.On

Gas: 3% Elec: 9%

March

EDF

Gas: 6.5% Elec: 7.5%

August

Scottish Power

Gas: 19% Elec: 10%

British Gas

Gas: 18% Elec: 16%

September

Scottish & Southern

Gas: 18% Elec: 11%

E.On

Gas: 18% Elec: 11%

October

Npower

Gas: 15.7% Elec: 7.2%

November

EDF

Gas: 15.4% Elec: 4.5%

 

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

Comments

This entry is now closed for comments

Jump to comments pagination
 
  • rate this
    +3

    Comment number 680.

    A problem I face as a tennent in York, who's landlord is in London, is that my house is not insulated in the slightest. The boiler is old and in-efficient. The hard fixtures are the landlords domain, and no way could I afford any of those improvements on my part-time wage anyway! But I am responsible for the energy bills, so I pay through the nose to have a cold house!

  • rate this
    +4

    Comment number 679.

    I for one would like to see a HYS debate about the lobbyists! I bet lobbyists for the energy companies are arranging meetings with ministers right now in order to persuade them to allow them to keep their cartels... ALL LOBBYING SHOULD BE MADE ILLEGAL NOW! Why should those with vested interests be able to have private meetings with ministers against the interests of the voters who put them there!?

  • rate this
    +2

    Comment number 678.

    In 1991 the Government vetoed British Gas from securing a major supply of gas from Norway - Sleipner gas field, this was a long term contract to supply the UK until 2020 with low cost gas. Nigel Lawson, sold British Gas and in doing so introduced more energy companies to purchase gas, with all the duplicity of staff and office accomodation his actions could only increase the cost of gas to the UK.

  • rate this
    +2

    Comment number 677.

    no spin - no bull - no waffle - JUST LOWER THE BILLS

  • rate this
    +1

    Comment number 676.

    The comparisons with prices in other EU countries is not a like-for-like comparison because a much higher percentage of Germans, Greeks, Spanish etc have PV as standard in their homes, so their need on buyibng in energy is much lower. Reduced demand equals higher unit prices. We need to catch up with other countries, who are at least 30 years ahead of us in terms of home renewable energy.

  • Comment number 675.

    All this user's posts have been removed.Why?

  • rate this
    0

    Comment number 674.

    The tariff structure is merely for energy companies to hide their true intentions - that is to increase the profits. They simply manipulate the market's supply and demand to maintain the profit margins. I don't know what the government can do on reducing consumers' energy bills as they are de-regulated businesses. We should be thankful that water companies have not followed the same step!

  • rate this
    +8

    Comment number 673.

    To all those blaming Thatcher, could you point out what Labour was doing for 13 years to put it right? There seem to be many cases of selective memory here when it comes to doling out blame for the state of the country's finances. Any government coming after the Blair / Brown era was going to struggle to do anything except be vilified, regardless of their actions.

  • rate this
    +19

    Comment number 672.

    I grew up in a large farm house, no double glazing, no central heating and stone floors. No not in the early 1900's but in the 1980's, we survived and today my parents still live there, granted they have central heating now but not in every room. Suppose what i'm trying to say is there is an over use of 'heating' today so maybe individuals could start by looking at there own consumption first.

  • rate this
    -1

    Comment number 671.

    It might be a good time for David cameron to apologise for his part's part in selling the utilities off to private investors, which is a large part of the problem. It might also be a good time to own up to his own parties previous follies on financial dergulation and stop the pass the buck mantra of 'the mess we inherited from the previous government'.

  • rate this
    +2

    Comment number 670.

    This is the exact problem which will arise with privatising the NHS. As soon as you privatise something such as a utility which we all need, the private company has shareholders who expect a profit and dividends. The power companies say they invest more, wrong they cannot whilst they have to pay profits. State owned is not efficient but would be cheaper, end of.

  • rate this
    +1

    Comment number 669.

    368.Bottski
    you say electric should be charged more for the more you use, fine but as long as if you use gas as well this counts in your total usage and you pay higher because of it. Those of us who do not have gas shouldn't be penalised as we aren't given the reduction for dual fuel.

  • rate this
    +4

    Comment number 668.

    Talk is cheap , unfortunately , under the cartel that currently operates , energy never will be.

  • rate this
    +3

    Comment number 667.

    Total nonsense and politics, the only way to create enough energy for future use is nuclear energy, Thorium reactors, safe and China is leading the way. Short term stop green taxes on fuel, people will freeze to death over dogma chasing a false prophet the IPCC. Stop wasted payments to prevent wind turbines producing, check the Muir report, do your homewok, be resposible.

  • rate this
    +2

    Comment number 666.

    The previous Govt with Lib Dem support signed up to legally binding targets to reduce power station emissions. The targets are far higher than any other European countries. To achieve the targets coal stations must close and be replaced by renewable energy stations burning biomass. The cost of this investment is made by the generators and will appear on every household bill.
    Let's have honesty.

  • rate this
    -1

    Comment number 665.

    The tax system we have is to blame for all this discrepancies, companies are out there to make a profit, and not become a charity. Energy bills have increased tremendously from source, but our government has actually been milking the profit from such increases, rather than find a way to ease the pain. All Cameron does is talk and no action, lets see what he does now.

  • rate this
    +2

    Comment number 664.

    It's time all Governments suspended the Greens' agenda; we cannot afford it during these times of financial austerity and further recessionary pressures. We know that Govt's are seeking ways to keep their tax take "even" whilst we the customers reduce our spend in these areas.To create a "tiger" economy one needs to release the country from all taxes. Where we are is where we will stay.revolution!

  • rate this
    +4

    Comment number 663.

    @ 651.
    Kamana

    How long is it since Mrs T was in power ? Precisely ,far too long to be blaming her for ANY of what is happening today .As usual she inherited a weak country from an ( as always ) incompetent and corrupt Labour government , just as the present government have done again, NOT that I think this coalition is doing much good ,but what a deficit it has to deal with after the last lot !

  • rate this
    +2

    Comment number 662.

    657.
    gnasher49

    I think Gnasher, we will soon find Cameroons pledge to bring down energy bills will morph into an "aspiration"

  • rate this
    +1

    Comment number 661.

    635.LouLou
    Utilities should never have been privatised as we're all losing out except for the fatcats
    +
    100% agree. They claim they're more efficient. But all they did was scrap customer service once available on high streets of most towns. How can 6 separate Boards,CEOs,Chairpeople,billing systems be cheaper/more efficient than just one? Thatcher cost us all just to look good. Useless.

 

Page 17 of 50

 

More Business stories

RSS

Features

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.