Graph: Competition between the Big Six isn’t working
This very helpful graph from IPPR sets out exactly why the failure of competition between the Big Six energy companies is having such an impact on household energy bills.
This very helpful graph from IPPR sets out exactly why the failure of competition between the Big Six energy companies is having such an impact on household energy bills.
Competition should be keeping the purple sections of the light bulb down, but that isn’t happening.
At today’s Energy and Climate Change Committee the bosses of the Big Six are likely to face a grilling by MPs over recent hikes in customer bills.
IPPR associate director Will Straw said the key question for the Big Six was “why profits of 5 to 6 per cent are acceptable in a competitive market”.
“In 1998, as the market was liberalised the regulator believed 1.5 per cent was an adequate margin for energy suppliers. Profits in other sectors like supermarkets are as low as 2 per cent. Energy companies need to come clean on why their profits have kept rising when consumers are being squeezed by so many other costs,” he added.
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