The State of the Market Assessment, prepared by Ofgem energy regulator jointly with the Office of Fair Trading and the Competition and Markets Authority, lists the reasons why competition is not working in the energy sector as well as it could:
- Declining consumer confidence, with 43 per cent distrusting energy companies to be open and transparent. This may deter consumers from engaging in the market and prevent them from getting a better deal for their energy.
- Continuing uncertainty over whether the vertical integration of the large energy companies is in consumers’ interests
- Retail profits increasing from £233 million in 2009 to £1.1 billion in 2012, with no clear evidence of suppliers becoming more efficient in reducing their own costs
- Suppliers consistently setting higher prices for consumers who have not switched
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