Energy sector regulator Ofgem has written to the UK's Big Six energy suppliers urging them to outline the impact falling wholesale prices will hav…
Energy sector regulator Ofgem has written to the UK's Big Six energy suppliers urging them to outline the impact falling wholesale prices will have on costs for their customers.
Rising energy costs have hit many consumers hard over recent years and therefore any reduction in prices would be extremely welcome for individuals currently struggling to make ends meet.
As a result, Ofgem has urged the UK's largest energy providers to be forthcoming about the impact that a reduction in wholesale costs will have on customer bills over the coming months, as this would go a long way towards restoring a measure of lost confidence in the industry that has taken place over recent years.
Wholesale gas and electricity prices have fallen significantly in the last 12 months, with early June witnessing the lowest wholesale prices for next day gas delivery since September 2010 – some 38 per cent lower than at the same time in 2013.
Meanwhile, wholesale electricity prices have now reached their lowest point since April 2010, with an annual reduction of 23 per cent.
It is therefore imperative that these savings are passed on to the consumer, Ofgem argued.
Chief executive Dermot Nolan said: "The Big Six suppliers tell us that they think the market is competitive, but our research shows that consumer trust is low.
"Therefore, if suppliers are going to start rebuilding that relationship they need to take the initiative and explain clearly what impact falling wholesale energy costs will have on their pricing policies."
Responding to Ofgem's call for clarity in the sector, Citizens Advice chief executive Gillian Guy stated that by passing on these savings, energy suppliers would not only be supporting hard-pressed households up and down the country, but it would also signal to consumers that these companies are treating them fairly.
Individuals facing issues regarding meeting essential bills should consider contacting a financial adviser, as these individuals could point them in the right direction towards getting their finances back on track.
Posted by Joe White