OFGEM says that, on average, domestic gas bills have risen by 71% and domestic electricity bills by 45% since 2003. The regulator says that the main driver behind the increase has been the rise in wholesale gas prices. It says that higher wholesale gas prices feed through to electricity prices because at present around a third of Britain's electricity comes from gas-fired power stations. Electricity prices have also been affected by rising oil and coal prices, lower nuclear availability and by the need to cut carbon emissions to tackle global warming, it claims. However, while fuel poverty has been rising as a result of higher retail prices, the big six suppliers have continued to make substantial profits, across their vertically integrated businesses, over the last few years. Dr Dominic Maclaine analyses how the big six have continued to make large profits in the most competitive energy market in Europe.
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