Big Six will earn £118 before tax from each household over the next year.
The UK’s Big Six energy suppliers will earn £118 before tax from each household over the next year, an increase of £5 compared to last month’s estimate, figures published in OFGEM’s Supply Market Indicator have been able to reveal.
The SMI is a 12-month forward look at cost trends in the domestic energy market. The latest indicators show that the average dual fuel bill for the next 12 months from March is £1,295. This is £6 lower than last month’s estimate and around £60 lower than our estimate a year ago.
Ofgem estimates that the suppliers’ wholesale gas and electricity costs will be around £553 or 43 per cent of an average dual fuel bill, while network costs for the next 12 months will be £295 or approximately 23 per cent of the average dual fuel bill
Furthermore, the cost of environmental and social obligations will be around £94 or approximately 7 per cent of the average dual fuel bill and suppliers’ operating costs are rated at around will be around £177.
Summing up, OFGEM estimates that the pre-tax margin a typical large supplier could make over the next 12 months, based on a 13-month rolling average is £118 or 9 per cent of the estimated annual dual fuel bill.
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