Suppliers aren't passing cuts on to customers

Despite claims to the contrary made by the 'Big Six' energy providers, consumer groups have long been convinced that suppliers are passing recent falls in the wholesale cost of oil on to their customers.

However, the extent to which consumers are paying over-the-odds has only just been revealed, with the typical household suffering to a worse degree than was ever previously believed.

According to the latest figures compiled by Consumer Focus, which the government set up only last year to look into overcharging, even householders who opt to shop around and switch utilities suppliers are paying far above the market race for their gas and electricity.

In fact, the UK's energy companies are estimated to be netting an extra £1.6 billion a year as a result of declining to pass on such wholesale price falls to their customers, amounting to an average of £74 per household.

The official watchdog's report revealed that, in order to reflect the recent shifts in the global energy markets, brought about by a variety of factors, not least security issues, the average Briton should be paying just over £60 a month less for their gas, while also paying £13.80 for the electricity.

Consumer Focus deputy chief executive, Philip Cullum, said: "Energy firms should take immediate action to put things right for their customers.

"A failure to act, and to ensure that people pay a fair price for energy, could have serious consequences for the sector."

To make matters worse for British households, consumers in Continental Europe are, in comparison, enjoying the benefits of the volatile wholesale energy market, which has seen gas and electricity prices fall by as much as 50 per cent over the past year alone.

However, the suppliers themselves have been quick to defend their pricing policies, maintaining that such charges are necessary due to the amount of money that will have to be ploughed into the UK energy infrastructure over the next few years if the UK is to both meet rising demand, as well as establish itself as a world leader in the field of green power.

Such a view has now been supported by a new report from the Institution of Civil Engineers (ICE), which warns that more investment is needed to make the infrastructure safe from possible terrorist attacks or even freak weather conditions.

According to the professional body, "there are dangerous weaknesses in our critical infrastructure and utilities networks that need to be addressed", with the government, energy companies and consumers themselves likely to be all called upon to pick up the tab for the necessary investment.