THE boss of Worcester-based energy giant Npower has claimed power bills in the UK are so high because many homes in the country are “old and draughty”.
In a report issued this week the company’s chief executive Paul Massara said unit prices for gas and electricity in the UK are among the lowest in Europe, but bills are high as houses waste so much electricity.
Mr Massara – who earns about £450,000 a year and last November refused to give up his £150,000 bonus – said: "If we can increase the efficiency of the UK's old and draughty housing, we can ensure that annual energy bills are some of the lowest too."
In October last year – the same week the company announced a 9.3 per cent increase in electricity bills and an 11.1 per cent rise in gas costs – your Worcester News reported lights were being left on at its Warndon headquarters on all night.
Earlier this month it was reported the company had once again received the greatest number of complaints of any of the top six energy supplies between June to September last year – receiving eight times as many as its closest rival SSE.
But Mr Massara said bills would continue to increase as a result of infrastructure modernisation works across the county unless householders take action to improve energy efficiency in their homes.
"Suppliers control less than 20 per cent of a bill and I want to shine a light on all the different aspects of energy, particularly to reassure my customers that there is no hidden profit,” he said. “We made a 3.2 per cent margin in our retail business in the first nine months of 2013.
"Over the same period our power stations were struggling to recoup the hundreds of millions of pounds in investment required to build them and made a loss of £59 million.”
But power regulator Ofgem disputed the claims, calling them “incorrect and misleading”.
A spokesman said: “We offered to help Npower improve the accuracy of their numbers for network charges and it is disappointing that they did not engage fully with us until after the document had been circulated.
"Ofgem directly regulates the money that network companies can earn through charges. Given this level of certainty we can see that after 2014 network costs per household are expected to remain broadly flat in real terms. It is unclear how Npower can state with any authority otherwise."
A spokesman from the Department of Energy and Climate Change called Npower’s report “incorrect on so many levels”, saying bills are likely to be lower in 2020 than they are today.