Care England has called for an investigation into “horrendous and financially crippling” energy bills facing care homes this winter.

In a letter to Ofgem, and the Department for Business, Energy and Industrial Strategy, seen by Caring Times, chief executive Professor Martin Green OBE accused energy suppliers of being “unduly onerous” in their practices.

The Care England boss cites analysis from Box Power CIC, the UK’s only philanthropic non-for-profit energy consultancy of live gas market prices and ‘out of contract’ gas rates, which showed “material differences to what could be reasonably expected”.

Box Power noted that 1,172p p/therm (40p/kwh) prices bear no relation to the daily spot price of just 3.2p/kwh currently, with December 2022 priced at 8.3p/kwh. (1p kwh = 29.3 therm). The analysis added that even lower prices at 25p/kwh by some gas suppliers were still unjustified.

The government announced support on business energy prices which runs until March 2023 in September.

Green told Caring Times: “Our sector is already seeing financial cost pressures on multiple fronts, so to find energy suppliers compound this situation further instead of being fair and reasonable is just incomprehensible to fathom.  Out-of-contract prices not just impact those who have ended a contract (but are yet to resign), but they explicitly penalise a new incoming operator, who in turn has absolutely no say in the matter until the supplier has carried out its internal change of tenancy process, which itself is allowed by Ofgem and can take many weeks, all the while it is the new tenant at the mercy of these horrendous prices until they can move supplier.  

“If energy prices today for the month ahead (December) are at 8.6p for gas and 26p for power, why are Energy Suppliers freely able to charge a rate without challenge or justification of up to 40p for gas and 120p for power presently.  Something is clearly wrong, and this horrendous practice needs urgent Ofgem and BEIS intervention.”

An Ofgem spokesperson said: “Ofgem’s priority is to protect consumers and businesses and ensure they pay a fair price for their energy. That’s why we are working with government and stakeholders to determine if further action or assistance is needed to help protect businesses including care homes and their residents, including whether a review on compliance of existing obligations is needed. We have a track record of robust action in compliance and enforcement where needed. We have received the letter from Care England and will respond to it in due course.”