Utility costs 'should be lower still'
Published On 16 April 2007
The failure of energy companies to cut their prices in line with wholesale reductions means that consumers are still paying too much for their utilities, a report from uSwitch claims.According to the independent website, recent price cuts from utility suppliers have only meant that the average annual bill will fall by £78. However, the site says that these cuts only counteract 28 per cent of the price increases which have occurred since the beginning of 2006.
This means that consumers are still facing far higher utility costs, despite the fact wholesale prices have fallen to levels similar to those pre-winter 2005.
Should consumer prices accurately track wholesale costs then the typical household bill would fall by £277.
"Waiting for energy companies to reward customer loyalty is like King Canute trying to turn back the tide – completely futile," said Ann Robinson, the director of consumer Policy at uSwitch.com.
"Consumers want a fair deal, but they are still not getting one despite the hyped-up price cuts. It's not unreasonable to expect some generous reductions now that wholesale costs have fallen."
Ms Robinson added that, in total, consumers could save up to £2.25 billion if they decided to switch utility supplier and seek a better deal.
