MPs and consumer groups attack energy firm SSE's profit

22 May 2013

MPs and consumer groups have reacted with outrage to the £410.1 million annual profit announced by big six energy firm Scottish and Southern Energy (SSE).

One consumer group described the figure – an increase of 27.5% on the 2012 profit from its retail division – as "a slap in the face" for customers, who were hit with an above inflation price hike of 9% last October.

SSE – which also announced it could not rule out further energy bill rises for its 9.6 million customers – was only last month fined £10.5 million for misleading customers by energy watchdog Ofgem.

Caroline Flint, Labour's shadow energy and climate change secretary, said: "Like all the other big energy firms, when SSE imposed inflation-busting price hikes last winter, they claimed they had no choice. But these figures show they have increased their profits on the back of spiralling bills for hard-pressed people.

"The time has come for a complete overhaul of Britain's energy market. For too long the energy companies have been able to do whatever they want, while households have been left struggling to pay their bills. The energy market must be made to work in the interests of ordinary consumers not the energy giants."

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Slap in the face for customers

Consumer groups also expressed their displeasure at the news. Richard Lloyd, executive director of consumer group Which, said: "Such a large profit announcement will be a slap in the face for SSE's customers who have been hit with an inflation-busting price rise and seen this company given a record-breaking fine for mis-selling."

Consumer Futures, formerly Consumer Focus, called for the profits to fund an energy debt write off programme. Spokesman Adam Scorer said: "If suppliers' expectation of increased costs means that they will not use these profits to reduce their prices, then Consumer Futures is calling on them to commit to a one-off and very targeted energy debt write off programme in addition to any existing initiatives.

"Some of this windfall profit must find its way back to the most hard-pressed households."

The profit announcement comes after figures show that, last winter, around seven in ten (69%) households went without heating to reduce their energy costs, according to comparison site Uswitch.

But SSE refused to rule out further price increases. In a statement, it said: "Unless there is a sustained reduction in prices in wholesale gas and electricity markets, it is highly likely that these additional costs will eventually have to be reflected in higher prices for household customers."

In April, energy watchdog Ofgem fined SSE £10.5 million for mis-selling between October 2009 and September 2012, after it promised customers they would save money by switching when, in fact, they were put on more expensive tariffs.

SSE apologised and is refunding misled customers the money they lost by switching to its tariffs – since 3 April 2013 it has refunded around 5,000 customers.

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