EDF Energy came under fire last night after announcing substantially smaller price cuts than its “big six” rivals – saving the average household just £9 a year.
The French state-owned operator became the last of the major energy suppliers to reduce prices yesterday, saying it would cut gas bills by 1.3 per cent from 11 February.
Consumer groups criticised EDF’s price cut because it is much smaller than those announced by the group’s main rivals over the past fortnight. These range from 3.5 per cent to 5.1 per cent for gas, with electricity prices staying the same.
But the cut is even more inadequate in light of the falling wholesale gas price, which has tumbled by more than a fifth since the summer, they said.
“This is truly the most underwhelming of the lot. It’s an absolutely paltry price cut in comparison to the 20 per cent fall in wholesale prices that we have seen,” said Stephen Murray, of MoneySuperMarket.
Ann Robinson, of uSwitch.com, added: “With the final price cut announced, it’s now official that standard tariff customers simply aren’t getting a fair deal. These meagre reductions are too little too late and must be increased.”
She added: “And, with the wholesale electricity costs also falling over the past year, why hasn’t a single big six supplier pledged to cut electric bills for its customers.”
EDF Energy defended its cut, arguing that it has seen little benefit from the plunge in wholesale prices because it buys the vast majority of its gas well in advance. It also said it had less scope to cut prices than its rivals because its bills are already lower than most of its main competitors.
“EDF Energy has a strong track record of acting independently in the interests of customers who have benefitted from the best standard variable prices for the majority of the last three years, in comparison to other major suppliers,” said Beatrice Bigois, of EDF Energy.
Although the “big six” have played down the impact of Ed Miliband’s pledge to freeze prices for two years if elected, experts said the fear of getting locked into low prices if wholesale costs rebound is a key reason why the cuts have not been larger.