News has just been released that wholesale gas and electricity prices hit a five-year low at the end of 2015 putting more pressure on suppliers to slash prices.
Prices plummeted as a mild winter in the UK meant a lower demand for energy along with lower prices globally thanks to shale exploration and an attempt at market monopolisation by OPEC.
We explained a few days ago why suppliers were slow to reduce prices despite plummeting wholesale costs yet the media has done its usual job of raising hype and hysteria.
Ann Robinson of comparison website uSwitch said:
‘Consumers on expensive tariffs have a right to expect a reduction of 10 per cent – which is a near £120 saving a year.’
News states that over the last two years, wholesale gas prices have come down 51% and electricity has come down 33%, yet consumer bills have only dropped by an average 5%.
But rather than blaming the suppliers, it’s time to look at the real culprits behind the sluggish price reductions. The government.
While Amber Rudd is publicly imploring the Big Six to drop prices, it is in fact within her own power to decrease prices.
With a large chunk of energy prices made up by government taxes and levies, this is really where consumers should be focusing their campaigning attention. Wholesale costs only make up 35% of your total energy prices.
So with this is mind, are business energy rates set to drop after a period of time once hedging has come into play or will prices remain stagnant?
With the colder months creeping in after a mild December, we expect suppliers to maximise on demand and doubt prices will drop enough to make a huge impact.
We advise customers to compare deals and make sure they’re not overpaying.
Business Juice can help. We don’t operate supplier bias or have quotas to fill, we just find our customers the best business energy deal on the market for the length of time they are comfortable with.
We’ll even terminate your old supplier making your switch as pain free as possible and you won’t have to lift a finger.
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