The Government believes companies have been “profiting unfairly at the expense of [the] consumer” by overloading the national grid with electricity.
They are then able to claim “unduly high” compensation payments to switch their wind farms and power plants off when the system becomes too full.
Official estimates suggest that some companies have been over-claiming for up to five years at a cost of up to £125 million per year – the equivalent of £25 for every household in Britain.
Two of Britain’s biggest energy companies — Scottish Power and SSE, which supply energy to six million homes — have been investigated for alleged abuses by Ofgem, the regulator.
All bill-payers in Britain have to bear these extra costs, regardless of who their energy supplier is.