There is now no justification for there not being the fullest possible inquiry into the prices being levied by the major suppliers. Consumers deserve nothing less.

In the United Kingdom today, we have six firms who dominate not only the selling of electricity and gas to householders but also have a dominant stake in its production.

In recent months, five of the big six have increased their prices – starting with British Gas, whose owners announced huge profits yesterday, then Npower, EDF Energy, Scottish Power and most recently E.ON. Only Scottish and Southern have held off, freezing prices until April.

Many observers have noted that over recent years when wholesale prices fell for a period retail prices were much stickier going downwards than they were going upwards.

Last month, Chancellor Alistair Darling summoned the energy industry regulator Ofgem to No 11 Downing Street. He seemed to accept Ofgem's argument that the energy market is competitive.

The regulator has consistently pointed to the amount of consumer switching between companies and argued that the rise in world energy prices is the reason for our own inflation in energy prices. Its belated review into the energy prices will, hopefully, put this theory to the test.

Yet Energywatch – the Government quango charged with representing the consumer interest – takes a very different view. Their analysis of the energy market is that the big six companies are so dominant that the market is in effect closed to new entrants.

They note that the number of large-scale licensed retailers of energy has fallen from 19 a decade ago to six today. They also point out that average gas prices to household consumers (as measured by Eurostat) increased by 64 per cent between, 2004 and 2006 – more than three times the average of 19.5 per cent across six peer European countries.

The consumer champion is not alone in their concern. The energy producer, British Energy, has written to the regulator Ofgem complaining that "the access of the 'big six' to their own power stations and gas supplies undermines competition by restricting energy sales on the open market".

Similarly, in a Commons debate earlier this month, Vince Cable of the Liberal Democrats highlighted the experience of BizzEnergy, a specialist producer trying to sell wholesale energy supplies to small-scale business. They had told him that "one of the biggest concerns facing companies like BizzEnergy is that with the 'Big 6' having their own power stations, with direct access to energy sources... this leads to market inconsistencies and aids the anti-competitive structure of the market".

It is ironic that some of our privatised utilities such as EDF Energy are now effectively back in state hands, but it is the French state who has a majority stake in the company. The European Commission is trying to encourage more deregulation and competition in the European energy market, even recently instituting a number of dawn raids seeking evidence of collusion, but it is a very slow process.

On the other hand, attempts to prove that the six brothers in our own country are colluding to fix prices are in many ways a distraction. Such is their market power they do not need to indulge in illegal price fixing – it is therefore the structure of the market that needs challenging.

Parliament has given the Competition Commission the power to instigate market investigations and where necessary break up companies in order to bring down barriers for new entrants.

The problem is that they can only act once a reference is made to them either by Government or the regulator. Unfortunately, as the chief executive of the Competition Commission has recently noted, regulators of privatised utilities never make such a reference.

This is probably partly as a result of professional pride – Ofgem, for example, does not want to admit that perhaps it removed price controls from gas and electricity companies rather prematurely.

Nor does it want to acknowledge that switching between energy companies is pretty meaningless if there is substantial market failure, and actually very difficult for those households on pre-payment meters, who are often locked into contracts as a result of debt that they simply can't afford to pay.

The Government seems equally reluctant to make a reference themselves. This is partly because Ministers are reliant on companies such as E.ON, RWE and EDF to build the next generation of power stations and perhaps also because of a reluctance to be seen as anti-business.

It is possible that they are being too timid on both counts. Such is the profitability of power generation that the energy companies are unlikely to take their bat home any time soon.

In addition, manufacturing industry would rejoice at any initiative designed to bring down their rising costs. Yesterday's announcement of a five-fold increase in profits from British Gas brought with it an outpouring of consumer anger.

The House of Commons Select Committee for Trade and Industry has recently announced an inquiry into energy prices. If it recommends a reference of the energy sector to the Competition Commission, the Government might at last be emboldened to act.

Privatisation of energy utilities almost certainly did bring increased competition and choice in the 1980s and 1990s.

The problem is that now British industrial and domestic consumers face the worst of both worlds – a regulated market in Continental Europe dominated by national champions and a nominally competitive UK market dominated by those same national champions.

For some, high energy prices are a matter not just of inconvenience but of life and death. Every year, nearly 25,000 more people die in the winter months in Britain than in the summer months simply because of fuel poverty. In freezing cold Scandinavia, there is no statistical difference regarding deaths of the elderly at different times of the year.

Faced with such a stark statistic, Labour Ministers need to rediscover a progressive critique of the occasional excesses of corporate power. A reference of the six brothers to the Competition Commission would be
a good start.

A second step which would benefit vulnerable consumers directly, would be to amend the Energy Bill which is currently on its way through Parliament so that all energy companies have to offer the poorest and most vulnerable customers social tariffs so they can keep their heaters on during cold weather.

Doing nothing is no longer an option.

John Grogan is the Labour MP for Selby and author of a House of Commons motion calling for a Competition Commission inquiry into energy prices.