Pull The Plug On Profits!

Adapted and edited from Sky News here.

Recent price rises have helped energy suppliers increase their profit margins more than seven-fold, according to estimates by the energy watchdog. Ofgem has calculated that annual profit margins per customer have risen to £125, from just £15 in June. Following inflation-busting bill increases over the summer, the regulator estimates the average dual-fuel bill now stands at £1,345.

Ofgem told Sky News Online there were a number of factors contributing to the rise, including VAT, suppliers' operating costs and a 40% increase in the wholesale cost of gas over the last year. The numbers were revealed as part of a review of reforms which aim to simplify the energy market and make it more competitive. Under the proposals, standardised pricing information will mean consumers can avoid having to compare the 400 tariffs which currently exist. Households wanting a no-frills tariff will get a simple unit price and a fixed standing charge set by Ofgem. Wathdog head Alistair Buchanan remarked:

"When consumers face energy bills at around £1,345 they must have complete confidence that this price is set by companies competing in a fully competitive market. At the moment this is not the case."

However, energy firms have reacted angrily to the watchdog's figures. British Gas slammed the report as "misleading" saying that for the first six months of the year the company's margins per household were actually £24.

Managing director Phil Bentley said: "Their methodology is flawed excluding, as it does, the discounts we give our customers and the benefits they receive from fixed price contracts, as well as understating our commodity costs.

"In 2010 alone, this methodology overstated industry profits by 100% compared with Ofgem's own analysis of audited accounts."

Another supplier, Scottish & Southern Energy, said that its own calculations indicated a profit of £62 per dual fuel customer. The company's the chief executive told Sky News that moves to make the market more competitive may not actually result in cheaper bills for customers.

According to Ofgem's data, the average dual fuel bill has risen 54% compared to four years ago, whereas wholesale costs have grown just 30%.

-----------------

The basics of life: water, food, shelter, heat and light. Everyone should have these, right? Everyone should have these but millions don't and even here in the UK, many struggle to obtain them. Why? Because the stinking capitalist profits system as exemplified above take the riches YOU have made and at the same time prevents access to these basics unless you can pay again, all in the name of profit. How about turning up the heat on them and pulling the plug on this system - instead we can united work towards putting a new socialist one in its place, where the necessities of life will be available to all.

SussexSocialist