UK to hold summit over rising energy bills

Updated: 2011-10-17 11:01


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LONDON - Britain's Prime Minister David Cameron will hold a summit with the country's six major energy suppliers, consumer groups and the industry's watchdog on Monday to look at ways to bring down Britons' soaring gas and electricity bills this winter.

Energy bills have risen dramatically in recent months as companies raise their prices because of rising wholesale costs, meaning an average dual fuel bill in Britain costs 1,345 pounds ($2,125) a year, according to the watchdog Ofgem.

The regulator also said companies were making 125 pounds per customer in profit, the highest level since at least 2004. Suppliers dispute those figures.

The summit comes as the coalition government faces pressure from angry consumers. Austerity measures to deal with a record budget deficit have led to public spending cuts, rising taxes and unemployment, and sub-inflation pay rises.  

"Energy bills have increased by more than 100 pounds for most people since this summer," Cameron and Energy Secretary Chris Huhne wrote in an article for

"These price rises couldn't come at a worse time for consumers who are already feeling the pinch from rising petrol prices and the cost of the weekly shop."

There was no indication the summit would produce new measures. Instead it will focus on how consumers could be made aware of savings they might make by switching to cheap deals or moving suppliers, and the free or heavily subsidised insulation available for vulnerable households.  

"The government's warm words won't heat homes during a bitter winter," said Caroline Flint, the opposition Labour Party's energy spokesman.

"They're unable to take on vested interests, they won't tackle the spiralling prices imposed by the energy giants, they won't investigate the mis-selling of energy and they won't help the pensioners whose winter fuel payments have been cut."

Simpler energy market

Cameron and Huhne said the summit would be the start of "much more active engagement with consumers" to deliver a simpler and more transparent energy market.

In its proposed reforms last week, Ofgem said energy companies would have to simplify their billing and pricing structures which it said were far too complex to enable people to find the cheapest deals.

Britain's six largest utilities are German groups E.ON and RWE , British companies Centrica and Scottish and Southern Energy , French operator EDF and Spanish firm Iberdrola .

Ahead of the summit, RWE's npower said it would freeze prices for customers on standard residential tariffs for the coming winter and would also abandon the practice of doorstep selling.

"I am very aware that there have been significant increases in the cost of living," Volker Beckers, chief executive of RWE npower, said in a statement.

Centrica's British Gas also announced a range of measures which included a pledge not to raise energy prices for variable rate customers this winter and a "tariff checker" to ensure people were on the most appropriate payment plan.