When I gave evidence to MPs on energy prices, one of the things that surprised me most was the suggestion that wholesale prices have not been increasing and that smaller suppliers have been able to buy energy more cheaply than the bigger companies.
I was surprised because the price increases already announced this year by the small suppliers themselves suggest that they too have felt the pressure of rising wholesale costs. The claim that prices haven't gone up also runs counter to Ofgem’s statement last week that actual wholesale gas and electricity prices for this winter are up 8 and 13 per cent respectively. The simple fact is that wholesale prices are rising and they account for around half an average bill.
When we announced, with regret, that we had to increase our prices from 15 November, we explained that this was due to higher wholesale prices, network charges and government scheme costs. Don't get me wrong, it is true to say that not all suppliers will have experienced this.
However that's not because wholesale costs haven't risen. It's because smaller suppliers do not pay towards government environmental and social initiatives like the £135 Warm Home Discount for vulnerable customers or the multi-billion pound ECO energy efficiency scheme.
These costs have more than trebled since 2005 and now account for around 10 per cent of a typical bill.
We support the aims of all these schemes – they are designed to achieve important social and environmental objectives like tackling fuel poverty, cutting wastage and supporting low-carbon energy. However, at the moment the way they are funded is unfair and it is often the most vulnerable who lose out.
As I told MPs last week, I think it is morally indefensible that I, a Managing Director in a FTSE 100 company, pay the same towards government policies as a young person working in one of my company's call centres. Equally, it is not fair that a financially-savvy customer can avoid contributing anything towards these important schemes by switching to a supplier that doesn't have to charge for them. That means that less-savvy customers, including some vulnerable ones, pay more. It's socially regressive.
We believe we have a solution. Taking the cost of government policies out of bills and into general taxation would take over £110 off the average bill tomorrow, be much more progressive and enable all suppliers to compete on a level playing field.
Make no mistake: if the Government runs with this, we'll take the costs off bills pound for pound, penny for penny.
This would also remove a significant barrier to the growth of smaller suppliers. At the moment, there is very little incentive for suppliers to grow their customer numbers beyond 250,000 accounts as at that point they have to start paying for these government schemes. With those costs taken off bills, winning that 250,000th customer is a lot more attractive. So, as well as being fairer, this change could also lead to more competition - something everyone agrees would be a good thing.
Some of the debate of recent weeks has been constructive, some parts less so. But with so much attention on energy prices, there has never been a better opportunity to take a bold step towards a fairer, more progressive, more competitive system.