The Chancellor calls crisis meeting with Ofgem over price rises
Chancellor Alistair Darling has called a crisis meeting with energy regulator Ofgem over last week’s gas and electricity price rises. It is understood Darling is concerned that energy providers are using fluctuations in the wholesale market to excuse soaring prices.
It is hoped that the meeting will increase pressure on suppliers such as Npower, which has raised its rates by double-digit figures on Friday. Rival providers are expected to follow suit later this month.
In a letter to the Ofgem chairman, Sir John Mogg, and chief executive, Alistair Buchanan, Darling says: “I would be particularly interested in your views on the relationship between wholesale price movements and feed-through to domestic retail prices and the likely availability of gas suppliers from the Continent.”
The energy regulator will not reveal what it plans to say to Darling but a spokesman says: “Britain’s market is very competitive and some providers can price as an advantage to their competitors.”
An average of 3 million people change suppliers every six months. According to Ofgem, 4 million people switched suppliers in 2006 – a move which hit British Gas particularly hard.
