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What's all this about wholesale prices?

By OVO Energy Tuesday 29 October 2013

Did you catch our founder Stephen Fitzpatrick today at the Energy and Climate Change Committee talking about energy prices?

"It looks to me like a lot of energy companies - a significant number of the big six - are charging the maximum price they feel they can get away with to customers they feel will not switch under any circumstances," Stephen Fitzpatrick told the MPs.

As Stephen has highlighted in the media, the most expensive price we've paid for wholesale gas in the last four years was in May 2011 and since then it's been less. So how can we account for our rises in the past? Although there have been fluctuations in the market throughout the last two years, the point we are trying to enforce is that prices right now are fairly similar to levels two years ago. (Therefore massive hikes this year cannot be justified).

As you will see, wholesale prices for gas and electricity peaked earlier this year in April, and since then have dropped steadily bringing them back in line with prices as they were a couple of years ago.

Although there have been small fluctuations, we believe that energy companies hiking prices at this time of year and blaming it on wholesale costs is unjustified.

Those with OVO whom have seen rises are a result of competitive rates and a well-timed sign-up. We increased the price of our new energy and green tariffs earlier this year to reflect other costs that impact on the price of supplying gas and electricity to your home and we do not have similar planned increases to that tariff in the foreseeable future, especially given the stability of the current wholesale market.

We aim to be as transparent as possible, and we accept that our prices have increased in the past but cannot see any reason for this years’ rises.