Facts and Figures

Fuel Poverty:

  • Definition of a household being ‘fuel poor’ is: Those who were spending 10% or more of their net monthly income on energy bills.
  • Figures from July 2011  (which is before price hikes of 14.2% from energy companies in Autumn 2011):
    • Estimated 24% of homes (6.3 million households) in the UK are in fuel poverty.
    • 36% of working class households are in fuel poverty, and 15% of middle class households are fuel poor too
    • Current definition of fuel poverty doesn’t take into account housing costs – if rent or mortgage payments are factored in [1] then figure goes up to 33.4% (9 million households) in fuel poverty in the UK.
    • Under this revised definition of fuel poverty 47% of working class and 22% of middle class households would be considered fuel poor.
    • Household energy bills have rocketed by £472 or 71% in just over 5 years.
  • It is estimated that at least 2700 people die each year directly due to fuel poverty

Big Six Energy Companies:

  • Six energy companies: EDF, Centrica (British Gas), Eon, RWE Npower, Scottish Power and Southern & Scottish Energy provide energy for 99% of homes in the UK.
  • ‘The Big Six’ are a cartel. OffGem accuse them of stifling competition and working together to keep prices and therefore profits up
  • Autumn 2011 saw price hikes of 14.2%, (average across the big 6 energy companies)
  • The Big 6 energy companies paid a total of £6.2bn to their shareholders in 2010, and in 2011 they paid a total of £7.3mn to their chief executives in basic wages (not including bonuses).
  • Total pre-tax profits of big 6 in 2010: £8.55bn in 2010
  • Energy companies profits are un-transparent. Since the companies own and control both the generation and supply of energy, they can disguise the supply margin of profit by transferring it to a less high profile part of their operation- the generation, by selling the energy to themselves at a higher than market price. This also contributes to a lack of ‘visibility’ around the true market price of energy. This makes it hard for independent suppliers to compete and for new entrants on the generation side (such as companies that want to invest in renewables) to make informed investment decisions. Most importantly  this means that customers don’t know whether they’re paying a fair or inflated price for their energy.
  • Even though in January the big 6 reduced their prices, on average, by 3.2% gas and1.8% electric – including the increases of prices in september, means a net Increase of13.3% gas, and 8% increase in electricity bills
  • The average decrease for the big six in January was 3.2% gas and 1.8% electricity. Yet the wholesale cost of electricity and gas fell by 23.3% and 17.8% since March 2011. The wholesale price of gas currently makes up 47% of a gas bill, while the wholesale price of electricity makes up 46% of an electricity bill.  Based on this, the Big Six should have passed through average decreases of 8.4% for gas and 10.7% for electricity.
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