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Small energy firms 'escape levies' Small energy firms 'escape levies'
(35 minutes later)
The head of one of the UK's biggest energy companies has suggested that smaller providers have an unfair cost advantage.The head of one of the UK's biggest energy companies has suggested that smaller providers have an unfair cost advantage.
Tony Cocker, the chief executive of E.On, said small companies were excused from paying some of the environmental and social levies.Tony Cocker, the chief executive of E.On, said small companies were excused from paying some of the environmental and social levies.
Such levies make up between 8% to 9% of the average bill.Such levies make up between 8% to 9% of the average bill.
One of the smaller companies, Ovo Energy, has claimed that its bills are up to 13% lower than its rivals. The news come amid speculation that the Prime Minister may order a Competition Commission inquiry into the market.
The claim comes after the bosses of eight energy companies appeared before MPs on Tuesday to justify recent price rises. On Tuesday, Mr Cocker told MPs that there should be a full investigation. He and seven other company bosses were called before the Energy and Climate Change Committee to justify recent price rises.
"The small companies are exempt from a number of environmental and social obligations," Tony Cocker told the BBC's Today Programme. "Not all, but some of them." Speaking to the BBC's Today programme, Mr Cocker said: "The small companies are exempt from a number of environmental and social obligations. Not all, but some of them."
Energy firms with less than 250,000 customers do not have to pay the Energy Companies Obligation (ECO), or the Warm Home Discount. Together those account for £58 on an average bill.
Prices
Stephen Fitzpatrick, the managing director of Ovo Energy, claimed that his firm could cut bills for many consumers.Stephen Fitzpatrick, the managing director of Ovo Energy, claimed that his firm could cut bills for many consumers.
"I can tell you, of the four companies that have raised their prices, we are around £160 cheaper. So that's about 12% to 13% for a customer of average consumption," Mr Fitzpatrick told the BBC."I can tell you, of the four companies that have raised their prices, we are around £160 cheaper. So that's about 12% to 13% for a customer of average consumption," Mr Fitzpatrick told the BBC.
Ovo raised its prices by 5.8% in April 2013.Ovo raised its prices by 5.8% in April 2013.
So far this month, British Gas, SSE, Scottish Power and Npower have raised prices by an average of 9.1%.So far this month, British Gas, SSE, Scottish Power and Npower have raised prices by an average of 9.1%.
The regulator, Ofgem, estimates that levies add about £107 a year to an average bill, or 8%.The regulator, Ofgem, estimates that levies add about £107 a year to an average bill, or 8%.
The Department for Energy and Climate Change (DECC) puts the figure at £112, or about 9%.The Department for Energy and Climate Change (DECC) puts the figure at £112, or about 9%.
The Prime Minister has already pledged to consider "rolling back" some of the levies.The Prime Minister has already pledged to consider "rolling back" some of the levies.