Energy regulator Ofgem vows to crack down on greedy gas and electricity firms

ENERGY regulator Ofgem is to crack down on greedy gas and electricity network firms after The Sun revealed their excessive profits are ramping up bills.

Boss Dermot Nolan said the watchdog will tighten controls on the firms who have the local monopolies on the wires and pipes that get electricity and gas to our homes.

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And one firm, SGN, yesterday pledged to hand £84million of excess profits back to customers.

The Sun’s expose yesterday told how the ten firms make a combined £7.5billion a year in profit and pay their fat-cat bosses up to £6million a year.

Around £290 of an average family’s annual fuel bill goes to these firms — and around £96 of that is pure profit for them.

The Sun called for the firms to cut their profits — so household bills can drop. We also demanded excess profits they have already pocketed be returned to customers.

The move by SGN, which operates across Scotland and the south of England, to do just that was welcomed yesterday — but critics want more.

They point out that SGN made £533million in operating profit last year.

So the £84million, which covers 2013 to now, is a small fraction of that.

Edward Molyneux, of consumer collective The Big Deal, said: “It’s welcome news that Ofgem is taking a tougher stance on the mega profits of these companies but they’ve been allowed to get away with it for far too long.

“Since 2013 SGN made £1.8billion in profit so this £84million returned to customers is a drop in the ocean. Much more needs to be done.”

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Citizens Advice’s head Gillian Guy said: “Network costs are a significant part of high energy bills. With many consumers already paying over the odds for their gas and electricity, it is right that networks pay back the excess profits they’ve made.

“We have been calling for this on the back of the energy network companies receiving billions of pounds in unjustified profits. SGN’s voluntary contribution is welcome.

“Other energy network companies must now look to do the same for consumers — while Ofgem should be making sure that this money is returned to consumers as soon as possible.”

Mr Nolan said Ofgem is working with the ten network firms to get them to return excess profits.

But he named and shamed two firms — Northern Gas Networks and Wales & West Utilities — for burying their head in the sand and not entering into discussions to return money.

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