Ofgem to look into wholesale energy price discrepancies - 05/07/2011
Energy comparison customers might be interested to hear that Ofgem is to look into the wholesale prices paid by the Big Six energy suppliers to work out anomalies.
The industry watchdog is to look into claims that some energy companies are sourcing their gas and electricity supplies more cheaply than their competitors, which weakens the argument that all utility firms face the same wholesale commodity price pressures.
Tim Yeo MP, chair of the energy select committee, said he welcomed the move towards greater transparency.
"It reveals very different input prices and that some are much smarter at buying energy than others," he explained.
"It will mean consumers can see why they are made to pay higher prices by some companies so they can make judgments about which they would rather have as their supplier."
Mr Yeo added that the investigation will expose "the extent to which perhaps companies are exploiting their better position" rather than reflecting their own costs in reduced prices.
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