Energy scrutiny

There are already warnings of further significant increases in the pipeline in the wake of past rises which have seen costs soar.

Energy suppliers would no doubt argue they must retain their profit margins in the face of rising wholesale prices to invest in their networks.

But given the scale of their earnings, many hard-pressed householders and businesses struggling in the recession must be wondering if competition is truly working in the energy market.

Certainly if the Government is considering further avenues for boosting tax revenues, then a windfall levy on the power giants would enjoy huge public support.

Yesterday npower announced that nearly two million of its customers will receive refunds after being overcharged for gas.

Households will receive an average payment of about 35 as the firm, which has significant numbers of customers in the region after taking over from the former Yorkshire Electricity, pays back a total of 63m.

It has taken a campaign by the watchdog Consumer Focus for npower to repay the full sum, which it says is an example of how it can work with the energy industry for customers.

But the reality is that the excessive charges should never have been made in the first place and it should not have taken three years for the issue to be sorted out.

Ministers have made much of their plans to lift the regulatory burden from business. But until the energy sector gets its house in order, the Government must ensure the full weight of scrutiny remains in place.