British households paying extra £45 to line ‘pockets of vampire energy funds in Qatar and China’

Close-up of flames on gas hob
Gas charges have increased 38 per cent from £118 a year in 2021, to £163.69 from April 1 - Moment RF

An extra £45 a year charged to British householders is lining the pockets of ‘vampire’ energy funds in Qatar and China, new analysis suggests.

Charges added on to household energy bills for running the gas network infrastructure have increased 38 per cent from £118 a year in 2021, to £163.69 from April 1.

This is significantly above an inflationary linked increase of nearly 18 per cent, according to a new report from data analysis company Future Energy Associates.

Price rises

The price rises are signed off by Ofgem following negotiations with the gas distribution networks, most of which are ultimately owned by foreign companies, according to campaign group Warm This Winter.

These include National Gas, which owns and operates the main transmission network, and Cadent, which oversees more than 80,000 miles of distribution pipes.

Both are part–owned by Macquarie, the Australian financial services giant which has been criticised over its ownership of Thames and Southern Water.

The other companies in the gas distribution network are ultimately owned by 11 firms, including sovereign wealth funds the China Investment Corporation, and the Qatar Investment Authority.

The network charges will go towards funding new infrastructure investment, including an ongoing programme to replace steel pipes with plastic ones that can carry hydrogen, which the gas industry is backing as a greener fuel.

Close Up Of Smart Energy Meter In Kitchen Measuring Electricity And Gas Use
The price rises are signed off by Ofgem following negotiations with the gas distribution networks - iStockphoto

Warm This Winter, a coalition of more than 40 charities, including the Women’s Institute and CPRE, said the gas distribution network companies effectively operate as “natural monopolies,” which can tip negotiations with Ofgem in their favour.

It criticised firms’ reliance on long--term forecasting, as well as an “informational advantage” over the way it calculates costs, that could result in “unjustifiably high prices for consumers and excess profits for the companies.”

Simon Francis, a coordinator of the End Fuel Poverty Coalition, said negotiations between Ofgem and the gas networks should be made more transparent to stop “vampire funds sucking cash out of hard working families’ pockets.”

“This web of international investors with deep pockets and influence are heaping pain on the nation’s households,” he said.

‘Broken energy system’

Fiona Waters from Warm This Winter said: “Once again the British public is being gaslighted by an opaque and broken energy system which sees huge amounts of obscene profits going overseas and inflates bills for ordinary people.”

A spokesperson for the UK’s gas network operators said the network charges covered the cost of maintaining and improving the infrastructure and would allow them to mobilise billions of expenditure and investment.

“As regulated businesses, UK gas network operators’ returns are consistent with a methodology set by Ofgem.

“This essential investment – alongside the thousands of staff employed nationwide – ensure safe, sustainable, and reliable networks that deliver the energy that communities need now, and on into a decarbonised future.”

An Ofgem spokesperson said: “Our analysis shows that recent increases are driven by high inflation and recovery of the necessary costs to protect consumers from the impacts of the gas crisis in 2021/22.

“Our priority is to protect consumers now and in the future. Price controls are set to ensure gas networks provide a safe and secure supply of energy, can attract the investment needed to improve the system while ensuring profits are fair and reasonable.

“Each price review is subject to extensive consultation and stakeholder engagement at every stage of the process to ensure full transparency.”