Rising prices 'lead to record profits' - 17/10/2011

Many individuals may feel the need to perform an energy comparison to find a cheaper gas and electricity tariff - after new research revealed rising energy prices have led to record profits for suppliers.

According to a study of the market by Ofgem, the average dual fuel bill now stands at £1,345 per year, with energy suppliers making an average profit margin of £125 per customer.

The regulator notes that competition in the sector is being limited by the complexity of tariffs, poor behaviour by energy providers and a lack of transparency.

Commenting on the report, director of independent price comparison website Energyhelpline.com Mark Todd said many customers would be "stunned" to discover how much suppliers' profits have increased at a time when prices for gas and electricity are rising at such fast rates.

Research by the firm suggests the average fuel bill for this winter is likely to be more than £550 as a result of the recent hikes, which underlines the important of ensuring people are on the best deal.

Mr Todd said: "While tariff complexity does create confusion, the fact that 75 per cent of customers are still on standard tariffs is the main reason why so many pay high bills. It also explains why switching can save customers so much money."

He added it is now more vital than ever that people undertake a serious review of their energy contract and consider looking for a new gas and electricity tariff or supplier.

In the future, this should become an easier activity, as a key component of reforms to the energy market proposed by Ofgem will be to make comparing and switching deals as simple as possible.

Make sure you're not paying too much for your energy - compare gas and electricity prices now at energyhelpline.com or call 0800 074 0745