Sunday Times Exposes Energy Rip-Off Scam
by Jeremy Elton Jacquot, Los Angeles on 01.13.08
For the Brits in our audience who may have being wondering if they had ever been swindled by their energy companies, we have some bad news: you were right. An investigation by the Sunday Times has revealed that 6 of Britain's largest energy companies have been regularly quashing competition to raise prices and make huge profits - upwards of £4.5 billion, or roughly $8.8 billion.
According to testimonials from inside sources, company executives held confidential meetings at least every two months to discuss strategies; their smaller rivals were excluded from the discussions. Not incidentally, a recent poll commissioned by the Times has found that more than 8 out of 10 customers felt they'd been "ripped off" by the energy companies. Chancellor of the Exchequer Alistair Darling plans on meeting with Sir John Mogg, the head of regulator Ofgem, to go over the latest price increases.
Some of the illegal practices the companies are alleged to have engaged in include: charging loyal customers much more than those who switch; supporting costly and time-consuming accreditation for new firms to stifle competition; and raising/lowering tariffs in step within weeks to keep prices in line.
It's hard enough trying to push honest players in the energy sector to pursue more renewable sources. If we are to assume such scams are more widespread (and who's to say they're not), it's no wonder effecting meaningful change has proven so arduous.
Via ::Times Online: Energy rip-off exposed (news website)
See also: ::Organic Food Scam in the UK, ::Are Gas Prices High Enough?
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Between the supermarkets and the energy companies ripping off UK customers ad nauseum it's not surprising the UK economy is feeling pinched.
Now the chances are that the government will step in and fine the companies... but the chances are very slim that the people who were robbed will ever see a penny back.
This is an argument for further diversification and decentralization in power production and supply. As well as pointing out the need for greater transparency, and more effective regulatory action and enforcement.
This is quite similar to the situation that Enron created in California. Limited competition and centralized industries are prone to cartel behaviors. They raised prices and created blackouts in order to boost their profits, when power supplies were not in any danger.
Renewable energy sources allow for a quantum shift in how energy is produced and distributed. This can level the playing field and bring many of these large industries to heel.
Come on free energy! When are we going to realize Nikola Teslas' dream?