By Maximilian Clarke
Cirencester-based Ovo Energy has scrapped its scheduled January price rise, prompting consumer groups to ask why the ‘Big 6’ utility companies appear unable to do so.
The ‘Big 6’ energy companies- Scottish Power, Scottish & Southern, British Gas, Npower, E.On and EDF- have all introduced rises of between 9 and 18% over the past 12 months as global commodity prices rose, particularly in light of conflict in Libya. But recent drops in the prices of gas have yet to be matched by falls in consumer prices.
Welcoming OVO Energy’s decision to cancel its scheduled price rises in January, Audrey Gallacher, Director of Energy at Consumer Focus commented:
“This is a good sign and it throws down a gauntlet to the Big Six. Wholesale prices have been falling recently, and all suppliers should be looking at whether that provides an opportunity to bring prices down.
“A smaller supplier such as OVO may be able to react more quickly, but it obviously can’t operate on the same economies of scale as its much larger rivals. If it can cancel price rises because market fundamentals change, it begs the question why can’t others? When wholesale prices fall, you would expect companies fighting in a truly competitive market to start cutting bills.”
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