PRN: Energy Companies Profit as Customers Pay More
Energy Companies Profit as Customers Pay More
PRESTON, England, August 2, 2012 /PRNewswire/ --
Energy firms are reaping the rewards whilst customers are paying even higher energy bills, according to a new study.
Centrica, the owners of British Gas, have announced that there has been a 23% rise in profits at British Gas, which amount to Â£345million.
This increase has left customers angered as they feel that their high energy bills have contributed to the company's healthy profit. Not only have British Gas reported an increase in their profits, the big six energy companies such as EDF Energy, Npower, Scottish and Southern Energy, Scottish Power and E.ON have also received a higher return.
With the complexity of energy trading within the wholesale market, it is difficult to prove that it is solely these companies that are keeping customer tariffs at a high rate. The recent fall in the gas and electricity wholesale market has contributed to this, which has meant that bills have not been reduced at their standard rate.
Energy firms have also been criticised for only cutting energy bills by 2% which equates to Â£26 per monthly bill. As energy is bought in advance using a method called forward price, the prices are often set in advance, which increases the overall price of the energy. Customers that have seen costs double in the past eight years are worrying that the average cost of gas and electricity will rise past its current rate, which is Â£1,258.
Customers must also take into account the costs that need to be paid by the energy companies such as distribution, staffing, billing fees and taxes. Although some firms attempted to give discounts and reductions on energy at the start of the year, this has been short-lived and customers are hoping that prices will not continue to rise in the future.
Companies such as E.ON have agreed to keep their prices the same throughout 2012 and the SSE has also said that there will be no increase in prices before October 2012.
This highlights that some energy firms are making a conscious effort to improve the rise in energy bills to reduce the impact for many paying customers.
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