Consumers 'owed £3bn price cuts'

02-08-2007

Consumers 'owed £3bn price cuts'
Energy firms are not handing savings from low wholesale costs on to the consumer, according to price comparison website uSwitch.com.

An analysis of recent trends finds that average prices increased by £277 in 2006 but reductions so far this year have only resulted in cuts of £100.

This means British consumers have been left almost £3 billion out of pocket, uSwitch.com claims.

"The clock is ticking and consumers could see this window of opportunity slammed shut in their faces unless they continue to force the issue with suppliers," consumer policy director Ann Robinson said.

"The price war kicked off because of consumer power - British Gas, the first supplier to cut prices, did so in response to losing over one million customers, and then the other suppliers followed suit. Consumers now need to keep the pressure on and make competition work for themselves."

She said energy firms would attempt to justify a lack of reductions by arguing that prices are expected to rise again in the near future.

"The fact is that energy companies are well-positioned to cut prices again," Ms Robinson added.

"They've enjoyed a good 15 months of consistently low wholesale prices and now there's nothing left standing in their way - any wholesale contracts they were tied into that could reasonably have prevented them from dropping energy prices will have come to an end by now," she explained.


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