Overcharging for energy costs some households £300 a year, study finds
Following stints with Reuters and the Press Association, Martin Hickman joined The Independent as a news editor in 2001. He became the Consumer Affairs Correspondent in September 2005 and has run the paper's trenchant campaigns on packaging, bank charges and factory-farmed chicken. He writes on subjects as diverse as food, finance, energy and fashion. With Tom Watson, he is author of a new book on the phone hacking scandal, Dial M for Murdoch - News Corporation and the Corruption of Britain.
Monday 30 April 2012
Some households are paying £300 a year more than necessary for electricity and gas, according to new research.
In a study, the respected IPPR think tank said as many as five million homes were being overcharged for power and called for reform of the energy market so that the Big Six – British Gas, EDF, E.on, npower, ScottishPower and Scottish and Southern – faced stiffer competition from new entrants. If the market were truly competitive, IPPR calculated, efficiency savings by the Big Six would knock £70 a year off the average bill.
Overall, households could be missing out on as much as £1.9bn a year by 2020 unless the regulator Ofgem acted, according to the report, which was commissioned by one of the small suppliers, Ovo Energy.
The Independent is running an "End the Big Six Energy Fix" campaign, calling for a windfall tax on energy firms' profits – with the proceeds used make homes more energy efficient.
Will Straw, IPPR's associate director, said some of the Big Six were failing to offer consumers tariffs that reflected the true cost of energy. "Some households are paying £330 more than their neighbours while millions are being overcharged," he said.
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