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The Competition and Markets Authority has again accused the big six energy suppliers of profiting from standard variable tariff (SVT) customers despite recent cuts to gas prices.
In a detailed report following the provisional findings from its energy market investigation, the CMA said that the big six providers made cuts ranging from 5 to 5.4 per cent to SVTs at the beginning of 2016. However, it added that the cuts were minimal in comparison to the reduction in wholesale costs.
The report said: “Gains [for the big six] may even have increased further, since we would expect the acquisition tariffs to follow more closely the reduction in wholesale gas and electricity prices, which comprise roughly 50 per cent of the total costs incurred in supplying gas and electricity and have fallen around 33 per cent and 20 per cent since Q2 2015, respectively.”
The CMA previously found that between 2007 and 2013 the big six were enjoying large profit margins.
In the most recent report, the CMA added that wholesale gas prices have been on a downward trend since 2013 and claimed that in February 2016 they were on average 42 per cent down compared to the same period in 2015.
The big six suppliers have declined to comment at this time.
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