The boss of Energy Regulator Ofgem has suggested that the Big Six energy companies should supply electricity and gas to house-holds at a loss, despite the risk of putting independent suppliers out of business.
Dermot Nolan, the CEO of Ofgem, said that he had “no problem” with British Gas, Scottish Power, SSE, Eon Energy, EDF Energy and Npower using profits from their power stations to subsidise loss-making supply business.
Smaller Companies such as First Utility and Ovo Energy, do not control their own power stations, which prevents them from switching profits from one part of the business to another.
The big companies offer steep discounts on fixed online deals to attract new customers but continue to charge its most steadfast customers far more. About 15 million households, or about 60 per cent, have never switched suppliers and are unlikely to do so.