Labour claim energy companies paid nearly £4bn above the average market rate for electricity over a three year period... and passed the costs on to the consumer
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Your support makes all the difference.Energy companies paid nearly £4bn above the average market rate for their electricity and charged customers about £150 extra over three years as a result, the Labour party has claimed.
The Big Six energy firms have denied suggestions they sell electricity at inflated prices from power stations they own to their companies that supply customers, telling MPs in November that they "self supply" a small amount of electricity or none.
However the Labour party, which analysed official figures, claimed they had established that the firms had been buying power at a higher price than available on the open market.
Caroline Flint, the shadow energy secretary, told The Guardian newspaper that the figures revealed the "full extent of the way consumers have been overcharged for their electricity".
"Energy companies always blame wholesale costs when they put up bills, but it now looks like they could have deliberately inflated prices to boost profits from their power stations," she said.
"The time has come for a complete overhaul of our energy market. Labour will break up the big energy companies, put an end to the secret deals and force them to do all of their trading on the open market."
Labour has promised to bring in a 20-month price freeze on power prices if it wins the 2015 general election.
The party's figures were calculated by comparing the amount that energy companies paid for electricity against the average market price a year ahead.
However Energy UK, which represents the Big Six - SSE, E.ON, EDF, npower, Scottish Power and British Gas - said these figures were "totally different" and could not be compared.
"It is also worth pointing out that there isn't a single 'wholesale' price. Different companies buy at different times, from different people, for different prices depending on demand, forecasts and a whole host of other factors," a spokesman told The Guardian. "These different business practices mean that each energy company will be paying a different amount for its wholesale energy."
In 2011, Andrew Wright, who was then a senior partner responsible for markets at energy regulator Ofgem, said it was a "sensible conclusion" that power companies were self-supplying, but he added there was no actual evidence.
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