Leader: Cosy chat with ‘big six’ lets energy consumers down

IT WAS billed in advance as the big showdown. Tough-talking Prime Minister Dave Cameron and his trusty sidekick, Energy Secretary Chris Huhne, were going to read the riot act to the “big six” energy companies over the soaring fuel bills which have so angered the consumers of gas and electricity in this country.

The reality after the grandly titled “energy summit” was rather different, as Mr Cameron and Mr Huhne emerged with a raft of puny proposals, none of them earth-shattering. The three ideas they choose to highlight – telling customers to switch supplier to secure a better pricing deal, to change their payment method to direct debit and to better insulate their homes – were underwhelming statements of the obvious.

Ministers will argue that if the summit managed to get even these ideas across it will have succeeded, but useful though these messages may be, such a claim would stretch consumers’ credulity beyond breaking point. It is true that the simplification of suppliers’ suspiciously complex tariff schemes that energy watchdog Ofgem is pushing through will help customers make a more informed choice. However, as anyone who has ever switched their supplier knows, the truth is that there is not much difference between most price packages on offer, making a mockery of the idea that there is proper competition in the UK domestic energy supply market.

And if this were not depressing enough to voters who want to see the government take their side against exploitative big businesses, there is a further cloud on the horizon, in the shape of a warning from the European Commission that average prices for households could rise by up to 100 per cent up to 2050 as a way of paying for investment in renewable energy, in particular wind turbine generators.

What might Mr Cameron and Mr Huhne have done yesterday? First they could have announced a move towards proper competition in the domestic energy market, perhaps encouraging the entrance into the market of a no-frills supplier, a kind of “EasyElectricity” that would genuinely force the others to consider their charges.

They could also have got tougher. Ofgem has predicted a rise in firms’ prospective profit margins from £15 to £125 per customer, figures the industry says it “does not recognise”. Even the threat of more regulation would have helped to apply more pressure for prices to come down. Finally, they could have become more serious about insulation – boosting the programme for homes would not only help cut bills but be the kind of new deal initiative which could help create work to absorb high levels of unemployment.

In short the coalition should have read the big six the riot act. Timid chastisement during a cosy chat is simply not good enough. The public, who were led to expect more, have been badly let down.