Watchdog says price increases 'unjustifed'

Watchdog says price increases 'unjustifed'

Energy companies such as British Gas which have increased household bills by over 15 per cent should be referred to the Competition Commission, according to consumer watchdog Energywatch.

In the past month, British Gas, EDF Energy and Npower have all increased utility bills, hitting more than two-thirds of UK households. The average annual bill is now over £1,000, double that of 2003.

Scottish Power and Eon are also expected to increase prices soon while Scottish and Southern Energy has promised to freeze prices until April.

Speaking on BBC News yesterday, Allan Asher, chief executive of Energywatch, said the energy market was uncompetitive and the price rises were unjustified. 'Sadly the market is not working well and that's leading to consumers paying much, much more than they need to,' he said.

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This month regulator Ofgem was forced to assure Gordon Brown that energy suppliers were not colluding on price rises. Energywatch questions why companies are so slow to pass on savings from lower wholesale gas and electricity prices but so quick to increase bills when wholesale prices rise.

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