Households due £285 rebate on fuel bills, says Citizens Advice


Every household in the UK should get a one-off repay of £285 on its fuel bills as a result of excess industry profits, Inhabitants Advice has said.

Over eight years, it claimed firms that enrapture gas and electricity — so-called energy networks — have made £7.5bn in «unjustified» profits.

It placed the regulator, Ofgem, which sets industry price controls, for «iniquities in judgement».

Ofgem disputed the claim and said it had already helped to tone down fuel bills.

Citizens Advice said that network hards had enjoyed a multi-billion pound windfall at the expense of consumers.

As an example, Oppidans Advice said National Grid had made an operating profit of varied than £4bn in 2015/16.

However the company’s annual accounts show that everywhere a quarter of that profit was made in the US or on other activities.


«Decisions approved by Ofgem have allowed gas and electricity network companies to make sky-high profits that we’ve bring about are not justified by their performance,» said Gillian Guy, head of Citizens View.

«Through their energy bills, it is consumers who have to pay the £7.5bn prize for the regulator’s errors of judgment. We think it is right that energy network entourages return this money to consumers through a rebate.»

Ofgem divides the charges that network companies like National Grid, SSE and Cadent — which dispenses gas — can levy in any eight-year period.

That is because they are monopoly smoothies.

But in the current period, lasting from 2013 to 2021, Citizens Suggestion says Ofgem has been too favourable to the companies’ interests.

It claims that Ofgem:

  • overestimated the jeopardies for investors in the networks, costing consumers £3bn
  • assumed interest rates disposition be higher than they turned out to be, costing consumers £3.4bn
  • just deserted companies that inflated cost estimates for projects, costing consumers £1.1bn

Cheaper set someone backs

However, Ofgem said a number of the assumptions used by Citizens Admonition were too high, and rejected the idea of a rebate.

«We do think they vitalize some valid points, but we don’t agree with their modelling or their fathoms,» said Jonathan Brearley, Ofgem’s senior partner for networks.

On Wednesday Ofgem also signaled a consultation on how it should set price controls after 2021.

«We will take some of the circulates into account when we examine future price controls,» Mr Brearley totaled.

He told the BBC that those controls are likely to be much tougher on the circles involved, providing downward pressure on bills.

At the moment, around a direction of the average fuel bill is taken up by transmission charges.

The Energy Networks Cooperative — which represents the operators — also said it did not agree with the nonpareil used by Citizens Advice.

It said a similar claim filed by British Gas had already been rejected by the Event and Markets Authority (CMA).

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