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Average Household Now Being Overcharged on Gas and Electric by £74 a Year!

Watchdog Consumer Focus has released a report stating that energy companies are withholding £1.6bn worth of savings from their customers. Widely reported all over the media when the story broke on 25th June, the Watchdog Consumer Focus report states that energy companies have failed to act to bring consumers household energy bills down, in-line with recent reductions of wholesale prices.

Households saw their energy bills rise last year by over 40% in price, brought upon by the rising cost of oil. And, although energy companies were quick off the mark to increase prices, they have failed to be so speedy in reducing end user costs, despite their savings. The report suggests that gas is being charged at over 7% more than it should, and customers are being overcharged by more than 3% for their electricity, resulting in an estimated £74 annual cost to the consumer.

Gerry Felgate, the Chief Executive of Energy Retail Association, came out in defence of the ‘big six’ energy supply companies, saying that the watchdog group had miscalculated. Mr Felgate argues that energy prices are calculated on more than just end user consumption, and factors such as transportation of gas and power, and the government costs relating towards carbon emissions, all contributed to overall expenditure.

End users were warned by, that if energy prices continue to rise at the same rate, by 2020, households could be expected to pay nearly £5000 a year on gas and electric! In the mean time, consumers are encouraged to visit the Uswitch website, to see if they could be getting a better deal.

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