Morning:
3°c
Precious is a new-style weepie but one that is much more bracing than depressing
BBC accused of having a 'culture of secrecy' after it refused to reveal how much it pays its top presenters and stars
More...
'Pickpocket' foreign fuel giants 'ripping off' Britons to keep energy bills down in Europe
Last updated at 08:50am on 08.08.08
Victim: Some of the most vulnerable customers have seen their energy bills rise by 75 per cent
Foreign energy firms have been accused of 'picking the pockets' of 11 million British customers while capping price rises in their home countries.
French-owned EDF has announced a 22 per cent rise in gas bills and 17 per cent on electricity for its 5.5million UK users.
At the same time, it has secretly raised gas prices for some of its most vulnerable customers by as much as 75 per cent.
The increases are in stark contrast to the situation in France.
EDF has been told by the government there to cap its increases on electricity to just 2 per cent and gas to 5 per cent.
There are fears the company, which is part-owned by the French government, is looking to protect its profits by imposing punishing increases on UK families.
The price cap in France will not stop EDF imposing big rises in the cost of electricity it sells to Britain via a cable under the Channel.
The increases were strongly criticised yesterday by Ed Mayo, chief of the National Consumer Council.
'Closed and protectionist European energy markets end up picking the pockets of consumers in this country,' he said.
He suggested Britain should consider introducing French-style price caps. 'If the French are capping prices, that is something we should be looking at. We should learn from the French,' he said.
'My concerns are for people on fixed income, such as pensioners, who will be switching off their electricity and heating this winter. That will lead to more illness and disease.'
Mr Mayo said foreign owned power companies - such as EDF, RWE Npower and E.on of Germany, and Iberdrola of Spain, which owns Scottish Power - must show they are not raising prices in the UK to subsidise customers in other countries.
Criticism has also been levelled at the German government for failing to open its energy market to competition.
He was speaking at a press conference to announce the name of a new 'super-watchdog', Consumer Focus, which will replace the National Consumer Council, Energywatch and Postwatch.
EDF, like the other 'big six' power suppliers, has a series of tariffs linked to the amount of gas that customers use.
It has increased the charge for 132,000 low users by up to 75 per cent - taking the charges up from 3.984p per kilowatt hour to 7p. A low-user customer who perhaps only has gas for a cooker will see the annual bill rise from £106.77 a year to £187.60.
EDF customer Philip Williams, 69, who lives alone in Walton-on-Thames in Surrey, said: 'I couldn't believe it when I got the bill and found the price had gone up by 75 per cent, not 22 per cent as we were told. I've had no notice that it would go up this much.
'During the winter months my bills will go through the roof.'
Consumer group Energywatch said: 'The message this sends out is that people who try to be careful and cut down on their use of gas end up getting penalised with bigger increases in bills than everyone else.
'All the evidence is that energy companies are disregarding the needs of their most vulnerable customers.'
LibDem energy spokesman Steve Webb suggested firms such as EDF may try to boost profits in Britain to counter price caps in their home countries.
'EDF will have to make up the shortfall somehow,' he said. 'They may have to look to customers in Britain.'
The 'big six' power suppliers also charge more than 3.5million customers who have prepayment meters around £150 a year more for their heat and light compared with those who pay via direct debit.
These firms offer social tariffs which are supposed to cut the bills of the estimated 4.5million households which are in fuel poverty.
However, the deals are wrapped in small print with the result that only a tiny fraction of eligible households are signed up.
A spokesman for EDF denied UK customers will subsidise those in France. He said both are standalone profitable businesses.
He added: 'EDF Energy has always taken its responsibility to vulnerable customers very seriously and has gone far beyond regulatory obligations to support customers struggling to pay energy bills and to keep warm.'
Reader views (22)
God I hate this country, soon not to be British G.
As my Spanish friend said no one is proud to be British anymore you are proud of your history, but not proud to be British.
- Gordon, London
Energywatch and Ofgem have, yet again, failed to protect the consumer. Could someone please tell me what they do as they certainly don't protect the consumer?
I complained to them saying that it was the policies were unfair where the (overseas) parent companies insist on the subsidiary company buys the gas/electricity only from them and charging a lower rate for supplying their own market. Only to be told that "There are no restrictions in the market as to where the suppliers can source their energy. British Gas is not required to purchase its gas from Centrica; that is a commercial decision made by the company." Good to know we are being looked after by those supposed to protect us from Thatcher's legacy!
- Andy, London
Referendum on Europe please...
- Grim Reaper, Hell
We're reaping what we sowed twenty years ago, when Thatcher & co sold off our national assets to the private sector.
- John, Bedford
The reason why the government wont' cap energy prices is simple. VAT. The more WE pay, the more THEY get in VAT returns. Furthermore, there is great political cohesiveness between the energy companies and government ministers, who if there are political points to be gained short or long term by keeping energy prices artificially high, then they will do so. The moment it is crucial to reduce them, (i.e. a general election) prices will drop. If a general election was called today, energy prices in the UK would drop soon after.
- Joan, London, England
Yet another example of the short sightness of all UK Government's. Why have they let all our major utility companies fall into foreign hands? A total lack of medium / long term planning. A short term influx of cash, happy share holders and then a few years down the line we are held to ransom by foreign "nationalised" Utility companies.
- David, Cambridge
Can anyone tell me why our government hasn't imposed a cap on price rises, like the French government has? Personally, I think it's because they are spineless, dithering and incompetent. If the legislation doesn't exist, pass new legislation, and hang what Europe thinks. If EDF or any of the other continental power giants wants to play rough, seize back their UK assets (assets, incidentally, that we have all paid for, and which have been sold off to the highest bidder).
The tragedy is, this government just doesn't care about its people -- it's prepared to watch the old freeze in their homes rather than slapping down the power companies. Pathetic.
- Mark, London
Oui, Madame Emma, vous avez raison!
- Charles Siu, London
So the EU who concern themselves with conformity in the size of vegetables, fruit and other trivia, do not seem to concern themselves with the bigger picture of conformity in pricing of utilities, standards in health care or anything else that has a major impact on the populations of the EU countries.
- Patricia, LONDON
I am French and I heard on the French radio news about the 5 % increase in France. I have left EDF since. What a bunch of ridiculous thieves. But then shareholders come before customers... So attacking EDFD and the cartel of the bg 6 is like attacking capitalism. So there is no end here apart from nationalisation.
- William, London UK
It serves us right because we allow the Westminster cartel to return to power over and over again and they know that they can do what they want to the British electorate. Sophisticated electorate my foot. Thatcher and her cronies conned almost everyone in to selling off the national assets and this bunch are even worse, I don’t blame the French or the Germans, we are suckers and are being treated as such. Why can’t we build our own Nuclear power plants, this is a nation that gave Newton, Darwin, James Clark Maxwell and many other great scientists to the world. Now most of the population can’t string a sentence together. I am afraid we deserve everything we get and everything that is heading our way in the future.
- Stephen Durr, London, England
Well surprise surprise! This is exactly what happens when you sell your all your countries interests to foreign companies. Unfortunately we have a government that only looks at short term monetary gain, and seem utterly incapable of understanding the future ramifications of their policy making!
- Ken D, East London
Hang on, does that mean we're effectively subsidising French gas and electricity bills?
- Emma, Nunhead, UK
The joys of privatised industry.
Thanks a bunch Mrs Thatcher.
- Kedge, marlboro wilts
If you don't like the way a company is treating you then move, it's called a free market economy.
- Viv Lafrance, London
In France the government supports the state and its people; in England the government supports itself.
- Srs, London
Once again the indigenous peoples of these isles are sacrificed by the traitorous British government.
- Kev, London
Why doesn't the Government crack down on selling our country's assets to overseas buyers? Gas, electric, water - BAA/airports. I'm sure other readers can add to the list! No more.
- Susan, Slough
How on earth have we got to the stage where so many of our vital resources are under foreign control? Weren't we going to sell the nuclear contract to EDF as well? Why don't we have the money or expertise in Britain any more? Someone sort it out!
- Claire, London
Why does Gordo and his band of thieves allow us to be ripped off? What is he going to do about this?...
- Ian Makin, Twickenham
Great Britain needs to withdraw from the the EU/EC/EEC/Common Market immediately.
Energy and food security are the most important issues facing our nation in the 21st Century. We need an enforced population reduction and billions invested in alternative energy (including nuclear) by the government.
- Anthony Cowlam, New York, US
So what is the answer? perhaps UK customers should leave EDF.
- Brian, wiltshire
