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William Powell AM demands more energy price cuts

February 9, 2012 11:00 AM
Originally published by William Powell AM

Planned price reductions by big energy suppliers have been described as too little too late by William Powell AM, Welsh Liberal Democrat Shadow Minister for Environment and Sustainable Development.

All the big energy companies have followed the lead of British Gas by announcing they will reduce prices by around 5% this spring, but this is nothing compared to the massive price hikes of the last two years says Mr Powell. He is demanding more energy price cuts now.

William Powell, Assembly Member for Mid and West Wales, said:

"Fuel poverty in Wales has soared to 41% of households which is the highest in the UK. So any price reduction is welcome news because it will help hard-pressed families. But the main reason for fuel poverty going up has been the price hikes imposed on us all by the big energy suppliers. A cut now is the least that they could do.

I am also concerned that most large energy companies have cut the price of one fuel only - the one that has the smallest number of customers. For instance, British Gas has only cut electricity prices but it has twice as many gas-buying customers. EDF and SSE (Scottish and Southern Energy) have only cut gas prices but more of their customers buy electricity. That does not appear to be a coincidence.

When the big energy companies pushed their prices up, gas and electricity prices rose together. That is not the case when we have price cuts. Wholesale prices have fallen from their 2011 peak by 19% for gas, and 25% for electricity, and yet we are only being offered a 5% reduction that will come into effect as winter ends when fuel use falls.

The energy companies are indulging in yet more cynical PR posturing. If they were serious about helping their customers they would reduce prices across both fuels, increase the size of the cut to reflect their falling costs, and introduce it immediately.

It is obvious that they will not change until they are forced to do so. That is why the Competition Commission needs to investigate this latest manoeuvre urgently."