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Ofgem accuses Npower of 'misleading' report Ofgem accuses Npower of 'misleading' report
(about 1 hour later)
The energy regulator Ofgem has accused electricity and gas supplier Npower of publishing a "misleading" report. Energy regulator Ofgem has accused electricity and gas supplier Npower of publishing a "misleading" report.
Npower, one of the UK's big six suppliers, said the idea of the publication was to "shine a light" on company costs.Npower, one of the UK's big six suppliers, said the idea of the publication was to "shine a light" on company costs.
In the report, the company argues that energy suppliers make small profits, and have little control over customer bills.In the report, the company argues that energy suppliers make small profits, and have little control over customer bills.
But Ofgem said that some of the data used was "incorrect and misleading".But Ofgem said that some of the data used was "incorrect and misleading".
In its analysis, Npower said the cost of transporting gas and electricity - so-called network costs- was likely to rise by 74% by 2020, pushing up household bills. In its analysis, Npower said the cost of transporting gas and electricity - so-called network costs - was likely to rise by 74% by 2020, pushing up household bills.
Between 2015 and 2020, it claimed network costs would increase from £295 per customer to £314.Between 2015 and 2020, it claimed network costs would increase from £295 per customer to £314.
But Ofgem, which regulates that side of the industry - and sets the price controls - said those figures were wrong.But Ofgem, which regulates that side of the industry - and sets the price controls - said those figures were wrong.
It said that after this year network costs per household "are expected to remain broadly flat in real terms".It said that after this year network costs per household "are expected to remain broadly flat in real terms".
"It is unclear how Npower can state with any authority otherwise," said a spokesman."It is unclear how Npower can state with any authority otherwise," said a spokesman.
Ofgem said it offered to help Npower improve the accuracy of its numbers.Ofgem said it offered to help Npower improve the accuracy of its numbers.
"It is disappointing that they did not engage fully with us," the spokesman said."It is disappointing that they did not engage fully with us," the spokesman said.
Energy wasteEnergy waste
In its report, Npower also sought to persuade its customers that it does not make large amounts of money.In its report, Npower also sought to persuade its customers that it does not make large amounts of money.
"There is no hidden profit," said the company's chief executive, Paul Massara."There is no hidden profit," said the company's chief executive, Paul Massara.
"We made a 3.2% margin in our retail business in the first nine months of 2013," he said."We made a 3.2% margin in our retail business in the first nine months of 2013," he said.
On the power generation side of the business, Npower made a loss of £59m over the same period.On the power generation side of the business, Npower made a loss of £59m over the same period.
"During the debate on energy, facts have been in short supply, but we urgently need to dispel some myths to restore trust in the energy industry," said Mr Massara."During the debate on energy, facts have been in short supply, but we urgently need to dispel some myths to restore trust in the energy industry," said Mr Massara.
He said prices were not just down to the "big six". More than 140 companies were involved in the industry in the UK, he said, including more than 80 who trade energy products on the markets.He said prices were not just down to the "big six". More than 140 companies were involved in the industry in the UK, he said, including more than 80 who trade energy products on the markets.
In the report, Inside the Cost of Energy, Mr Massara argues that the unit price of electricity in the UK is one of the lowest in Europe.In the report, Inside the Cost of Energy, Mr Massara argues that the unit price of electricity in the UK is one of the lowest in Europe.
"But bills are high because British houses waste so much energy," he says."But bills are high because British houses waste so much energy," he says.
Last November, the consumer watchdog Consumer Futures said Npower had received the highest number of complaints per customer.Last November, the consumer watchdog Consumer Futures said Npower had received the highest number of complaints per customer.
In a three-month period in the summer, it had received 202 complaints per 100,000 customers, more than five times its nearest rival.In a three-month period in the summer, it had received 202 complaints per 100,000 customers, more than five times its nearest rival.
Last month, the company was fined £3.5m by Ofgem, for breaching sales regulations.Last month, the company was fined £3.5m by Ofgem, for breaching sales regulations.