OFGEM tells electricity suppliers to cut prices or face fuel bill cap

Published:  27 February, 2012

Fuel bills could be slashed after energy watchdog Ofgem told Britain's six largest suppliers to overhaul their tariffs or face a mandatory cap.

The 'big six' energy suppliers – British Gas, EDF, e.on, npower, Southern and Scottish Power – were told to drop their prices following concerns that customers are being ripped off.

Some 5.5 million households are believed to be in fuel poverty, spending 10% or more of their monthly income on utility bills to heat and light their homes.

"Parliament has given us the task of trying to create an effective market where competition is the downward pressure on prices," said an OFGEM spokesperson.

The OFGEM decision came after EDF announced a huge surge in profits at a time when families are struggling to pay their bills.

EDF announced that its operating profits rose by 8.5% last year to almost £1.6 billion – equivalent to £427 for each of the 3.7 million UK households to which the French-owned company supplies gas and electricity.