Centrica 'refutes totally' idea 'Big Six' are a cartel

A general view of the Centrica Head office in Windsor. Photo: Steve Parsons/PA Wire

This is the Ofgem finding that is likely to cause the energy companies the most anxiety:

We also looked at the behaviour of the six largest energy companies.

We are not in a position to conclude on whether tacit coordination exists in this market.

However, we found a number of aspects of the behaviour of the six largest suppliers that would appear to be consistent with tacit coordination between them.

We have found that these aspects have become more entrenched recently.

This includes our observations that:

The large suppliers announce price changes around the same time and of a similar magnitude;

Profitability has increased for all of the large suppliers, and domestic supply margins have converged;

The large suppliers appear to raise prices more quickly and fully when costs increase than they reduce them when costs fall.

This morning, the chief executive of Centrica, Sam Laidlaw, told me he "refutes totally" the idea that the 'Big Six' are a big cartel. He says the market is "vibrant" and "very competitive".

Mr Laidlaw told ITV News only 9 per cent of British Gas's 9.2 million household customers have never switched supplier and "we gain and lose more than 20,000 customers every week."

Serious allegations, strong denials. Thank goodness, some would say, that the new Competition and Markets Authority is looking into this.

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