Increase in bills behind 'rising profit margins'

There has been "some evidence" of a profit rise for the Big Six caused by higher bills for consumers, the energy regulator said.

However, bill increases in 2012 were caused by a rise in wholesale prices, a report from Ofgem found.

According to the report:

• There was "some evidence of rising profit margins" - attributed to higher gas and electricity prices, rather than lower costs.
• Prices on the wholesale market rose by 14%, causing the rise in household bills.

• Increases in the cost of transmission, distribution and payments to Government, up a combined 20%, were added onto bills.
• A rise in profits in 2011/12 was partly caused by higher gas consumption during two winters which were colder than average, compared to 2011, which was warmer.

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