Energy Secretary wants gas profits to be investigated

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in Energy
"Energy Secretary Ed Davey wants Ofgem to look into the profits the big six energy companies make on gas bills..."
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Energy Secretary wants gas profits to be investigated

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Energy Secretary wants gas profits to be investigated

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Look at the dog's breakfast it served up as the Retail Market Review after two years or more of congratulating itself for taking its time. A two year review could not have served up so little for the consumer without a great deal of concerted effort.
Labour say they will abolish Ofgem - then, no doubt, shuffle the deckchairs under a new name where it will carry on doing the minimum as before. Nice work if you can get it. The FCA (formerly, FSA) is probably the model they will use. That doesn't work superbly.
You are spot on.
First of all, it shouldn't be a huge surprise that there's not more competition in the utilities sector, at least in terms of pricing.
All the companies are selling the same product, that they buy from the same supplier. It isn't rocket science that prices are not going to vary much, they are subject to largely the same costs, ie distribution and taxes, the only area where they can make a bit of a difference is economies of scale (which clearly isn't working as BG are usually not the cheapest) and cost per customer in terms of service, infrastructure etc.
The different here is about £60 a year per customer between the cheapest (I belive it's EDF) and the most expensive - nPower.
I would like them to investigate how much money the "Big 6" are making from the generation side of the business though as that is certainly not clear. They don't *appear* to be making unfair profits from the domestic market (5% or so seems reasonable) but the generation side of it may well be a different story.
As for "forcing" them to invest the profits back into the business, what would they be reinvesting in? How much of the profit to reinvest etc.
£40. Is that it? You'd save more by knocking VAT off the fuel.
Er, duh!
This asks more questions than it answers, sort the banks out first I suggest.