In a bid to set themselves apart from the competition, the energy supplier SSE has stated that they will be fixing their current energy prices until 2016 and that it will be streamlining its business to cover the profit shortfall.
SSE, which is based Perth, Scotland have said that in order to improve public perception it will be making some important changes to the way it runs its business. One of these will be legally separating its retail and wholesale businesses in 2015 in the hope that it will improve transparency. According to the SSE chief executive the company wants to become part of the solution and not the problem. To that end he has written to the government asking them to remove green taxes from bills and move them into general taxation.
The energy secretary Ed Davey has welcomed the news on the price freeze and points out that it shows that the Big Six are realising they need to take action to keep their customers. He says that the price freeze from SSE proves that energy firms are able to weather a cut in their profits by making cost cutting savings.
SSE have said that they will pay for the price cut by cutting 500 jobs and by shelving four planned offshore wind farms. It is thought that this will save £100m.
Both Labour and the coalition have tried to claim responsibility for the move by SSE with each side claiming the move was based on their policies. Labour announced last year that they would freeze energy prices if they are elected – a measure which was derided by the government. Despite this the Tories have praised the move by SSE. Meanwhile the government have pointed out that they want to remove green taxes from bills and have already taken steps to partially do so.