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Big Six told to reduce energy costs by Rudd

Bad news for energy suppliers as new energy secretary Amber Rudd has demanded the Big Six cut their energy prices.

We’re sure it’s come as a shock to the Big Six as they only recently breathed a sigh of relief at the downfall of the Labour party and their proposed price freeze.

Rudd has apparently written to the heavyweight suppliers asking them to cut prices now the threat of a price freeze was no longer present. She explained her department was “working hard to keep energy bills as low as possible” and her focus is to “get the best deal for customers.”

Npower’s chief executive Paul Massara had previously said the price freeze presented a level of risk “beyond that we could manage in the wholesale market,” which prevented price cuts in the run up to the general election.

Yet the supplier still does not have any current plans to reduce its prices despite the threat having disappeared.

Prices were reduced at the start of the year by between 1.3 per cent and 5.1 per cent in response to falling wholesale prices and political pressure. A win surely?

Not good enough says Rudd as gas prices had reportedly dropped by 20% at this time. We have some sympathy for the suppliers though.

As we’ve explained before, while wholesale costs may have dropped by 20%, they only account for 46% of the overall cost with taxes and network costs making up the rest.

We’re hoping that Rudd will get wise to this and start focussing on cutting government levies on our energy prices. Then we’ll have something to shout about.