WHEN EDF Energy became the fifth of the big six energy companies to announce a price rise earlier this month, it was applauded by the UK Government for its relative restraint.
EDF customers will see dual-fuel bills rise by 3.9% on average from January, the company announced, prompting Energy Secretary Ed Davey to welcome an increase "closer to inflation".
He spoke on the day inflation fell slightly to 2.2% so "closer" still meant nearly double. In the end, his words only served to highlight the eyewatering price rises imposed across the board this autumn: 8.2% by SSE, 9.2% by Scottish Gas, 10.4% by Npower and 8.6% by Scottish Power.
The headline figure in Ofgem's new report on energy company profits may come hedged around with various caveats but it is shocking nevertheless in the context of those price rises. The regulator said profit margins on generating energy were 20% last year, or £2.2 billion in hard cash. Even accepting Ofgem's warning - emphasised, of course, by the energy firms themselves - that the figure does not take into account the huge cost of investment in new power plants, or taxes, the sum did nothing to dispel the image of the big six as a powerful, money-making machine.
Less opaque figures showing the energy companies' profits for supplying households, as opposed to generating power, were healthy enough in any case. Between them, the big six made pre-tax profits of £1.2bn, a five-fold increase compared with 2009. Last year was indeed a cold winter, as Ofgem noted, and wholesale costs and transmission charges have been rising but, again, the picture looks warm and rosy for the energy companies and their shareholders.
The political fight over how to tackle rising bills and the painful impact they are having on family budgets and living standards is unresolved. Labour promise a temporary price freeze, if they win the 2015 General Election, as a prelude to somehow reforming the market. The UK and Scottish Governments have both rejected the plan, preferring instead to shift green subsidies off people's bills.
One thing is clear, though. Until decisive action is taken, families will continue to be squeezed, fuel poverty will rise and the most vulnerable in society will face an unacceptable choice between heating their homes or eating.
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