Watchdog shame six of the biggest energy firms for overcharging their customers
In this article we take a look at what the latest energy report from Watchdog means for the general UK population.
Who are the Big Six?
The big six consist of; British Gas, SSE, Npower, EDF, Eon and Scottish Power.
So what’s happened?
According to a Watchdog report, by overcharging customers, the ‘Big Six’ energy firms earn £1.2 billion a year.
The report also noted that being a loyal customer doesn’t work in the customers favour – 60% of those customers being overcharged are experiencing this because of their loyalty.
How do you know if you are classed as a loyal customer?
If you are currently on a standard variable tariff, it is likely you are being overcharged. The investigation by Watchdog said that around 60% of homes are on these types of tariffs, so many people will be affected.
Another category of people who are likely to be affected are those who fail to look around and switch providers in order to gain the best deal.
How have people reacted?
The report has received criticism from consumers and industry critics, and there have also been calls from consumers to break up 6 of the UK’s biggest power firms. Consumer groups have suggested that by breaking up the companies, they would be more competitively priced. This wouldn’t just mean cheaper bills for everyone, but more companies for people to choose from too.
But, although the report criticised all 6 companies and encouraged customers to shop around before they buy, Watchdog did not recommend breaking up the biggest companies in the energy market.
Many charities and consumer groups have been unhappy with energy companies for a while, this is because energy prices have seen more than a 20% fall but the companies haven’t made any noticeable cuts.
What does breaking up the companies mean?
In a nutshell, consumer groups want to see the power firms split up. They want to separate the energy supply side from the retail side. It has been suggested that if this was adopted prices would be cheaper as a result of more competition.
Will this be the end of the ‘Big 6’?
Even after this report, consumer groups are worried that this isn’t enough to break the hold that these six key companies have on residents of the UK. They’re concerned that action will not be taken and the companies will be allowed to carry on overcharging and earning billions.
So what does the future of energy look like?
At the moment it is unclear. Amber Rudd, Energy Secretary has written to the energy firms since the report was revealed. She has requested that all firms reduce their prices and cut the cost of their customers bills. But for now, all six energy firms have made no announcements to change and are continuing to profit.