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The head of one of the UK's biggest energy companies has suggested that smaller providers have an unfair cost advantage.
Tony Cocker, the chief executive of E.On, said small companies were excused from paying some of the environmental and social levies.
Such levies make up between 8% to 9% of the average bill.
The news come amid speculation that the Prime Minister may order a Competition Commission inquiry into the market.
On Tuesday, Mr Cocker told MPs that there should be a full investigation. He and seven other company bosses were called before the Energy and Climate Change Committee to justify recent price rises.
"Start Quote
End QuoteOnce an investigation is launched - and I am told that the prime minister is very close to initiating one - a cloud of expensive uncertainty will descend on the industry"
Speaking to the BBC's Today programme, Mr Cocker said: "The small companies are exempt from a number of environmental and social obligations. Not all, but some of them."
Energy firms with less than 250,000 customers do not have to pay the Energy Companies Obligation (ECO), or the Warm Home Discount. Together those account for £58 on an average bill.
PricesStephen Fitzpatrick, the managing director of Ovo Energy, claimed that his firm could cut bills for many consumers.
"I can tell you, of the four companies that have raised their prices, we are around £160 cheaper. So that's about 12% to 13% for a customer of average consumption," Mr Fitzpatrick told the BBC.
Ovo raised its prices by 5.8% in April 2013.
So far this month, British Gas, SSE, Scottish Power and Npower have raised prices by an average of 9.1%.
Social and environmental levies | ||
|---|---|---|
| Levy | Use | Cost to customer per year |
| source: DECC | ||
| Energy Companies Obligation (ECO) | Energy-saving measures for low income homes | £47 |
| Warm Home Discount | Rebate to low-income households | £11 |
| Renewables Obligation | Requires companies to buy green energy | £30 |
| European Trading Scheme | Sets cap on emissions | £8 |
| Carbon Price Floor | Tax on use of fossil fuels | £5 |
| Feed in Tariffs | Subsidy for green energy generation | £7 |
| Smart meters and better billing | To cut use of estimated bills | £3 |
The regulator, Ofgem, estimates that levies add about £107 a year to an average bill, or 8%.
The Department for Energy and Climate Change (DECC) puts the figure at £112, or about 9%.
The Prime Minister has already pledged to consider "rolling back" some of the levies.
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