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Business energy customers are already benefitting from falling wholesale energy prices, suppliers have told Utility Week.
Business energy supplier BES Utilities said in a statement on Friday it is set to cut prices by 7 per cent in April in response to historic lows in the oil market.
In addition, Smartest Energy and GDF Suez told Utility Week their flexible market tracker tariffs mean customers are able to benefit from changing wholesale costs throughout their contracts.
The comments come following calls by Chancellor George Osborne for energy companies to “immediately” pass on savings following the considerable drop in oil price to five and a half year lows.
The Chancellor said a failure to pass on lower costs could result in action being taken against the companies.
Utility Week contacted all of the big six suppliers, but none could confirm plans to comply with Osborne’s calls.
BES said it is able to pass on the falling wholesale prices because it offers a market tracker product which reviews wholesale and other costs twice a year, with the next review in April.
BES Utilities’ managing director, Andy Pilley said: “As a smaller, independent supplier, we can respond very quickly to price changes in the market and this is another example of how we continue to take the fight to the big 6 companies”.
Independent supplier First Utility said it has dropped its prices 8 times over the last year “reflecting a drop in wholesale energy”. It most recently cut its prices on Wednesday, it said.
First Utility’s, chief customer officer, Ed Kamm says: “As the cost of wholesale energy continues to fall, First Utility believes in passing these savings onto customers.”
But SmartestEnergy head of regulatory affairs Colin Prestwich said in a statement that competition between suppliers should drive price setting, and warned that political intervention would be “unhelpful”.
“We are concerned by George Osborne’s comments – there is already a CMA investigation underway into the industry and we strongly believe that competition is the best way of ensuring the best deal for consumers, so further intervention would be unhelpful”, Pretwich said.
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