GMB's Adil Ray lets rip at Ofgem boss as he asks powerful question

25 August 2023 , 11:01

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GMB's Adil Ray lets rip at Ofgem boss as he asks powerful question

Good Morning Britain's Adil Ray grilled Ofgem's Chief Executive Jonathan Brearley about the incredibly high profits reported by energy companies as bills are rising for the public.

During Friday's episode, Adil, 49, and co-host Charlotte Hawkins reported the breaking news that Ofgem has slashed the energy price cap to £1,923 for the average household from October. Later in the show, the two presenters spoke to Ofgem's Chief Executive Jonathan, where Adil, who admitted earlier in the show he couldn't get his "head around" the "amount of profits" being made by energy companies, asked a powerful question.

The presenter said: "Some people who definitely have got nothing to worry about when it comes to energy bills are the bosses of the energy companies. Can you explain something to me and I'm absolutely baffled. I've tried to read up on this. We've discussed it here on the show this morning.

Good Morning Britain's Adil Ray grilled Ofgem's Chief Executive Jonathan Brearley about the incredibly high profits reported by energy companies

"I cannot work out why energy companies like British Gas have reported profits of £969million pounds after the price cap rise. It has been reported that half that profit £500million was due to changes to the price cap made by the energy regulator. In comparison, British Gas reported a profit of £98million pounds in the same period last year.

"People are watching at home this morning, and we're arguing about £150 pounds here, the saving they might make, it just sort of disappears into comparison when you think about these extortionate profits energy companies are making. Why is that?"

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To which Jonathan replied: "Sure, well, if you look over the last two years, particularly look last year, when those prices were rocketing. Remember the wholesale market the place that companies buy their electricity and gas from got to 20 times the amount that we normally pay. Now, as the sector as a whole made a significant loss, particularly from that from last year and from COVID.

"Now what we said this year was that they can recover not all of it just a proportion of those costs. And so yes, things look different this year, but when you look over the two years for the sector as a whole. Actually, the average profits are around zero and certainly well below what we think a regulated return should be for shareholders. Now, if we don't do that, if we don't allow companies to recover costs, we know what happens, because we saw this in 2021. That costs customers billions when companies go bust. So our job is to make sure we get the balance right. Yes, protect customers from cost today, but also make sure we don't land them with big bills in a very short period of time in the future."

The two presenters spoke to Ofgem's Chief Executive Jonathan

To which Adil replied: "But, I understand some of that, okay, that's to protect their businesses, but there seems to be a very high margin they are making here, it is a huge profit." He adde: "Why is it, why does it have to be so much money? I can understand they need to protect themselves but that much profit?"

With Jonathan responding: "We regulate the retail companies, those are the companies that buy and sell energy. It is true. There's another part of the whole sector, the ones that generate electricity, the ones that get the gas out of the ground, that have made large amounts of money as those international prices have rocketed. Now that's not something that Ofgem controls but something ultimately the government has responded to and they've taxed those profits over time."

GMB viewers were quick to praise Adil as one person said: "Thank you for challenging the government and asking well-researched questions on our behalf", a different account put: "Adil Ray smashing it on #gmb", while another person wrote: "Adil Ray on the profiteering energy companies. Well said! #GMB!"

Olivia Wheeler