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Energy regulator boss faces MPs

The man charged with regulating the energy industry will answer to MPs later today after it emerged profits of Britain's "Big Six" energy suppliers multiplied five-fold to more than £1 billion since 2009.

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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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