Millions of households may be paying too much for their energy, regulator Ofgem is expected to say on Thursday.
The energy sector is likely to be referred to the top competition watchdog to face an investigation into allegations of profiteering.
The Big Six companies have a case to answer over the prices they charge, in particular for customers they inherited from before privatisation, the regulator is likely to say in a “state of the market” report.
Ofgem is expected to say it is minded to refer the sector to the new Competition and Markets Authority, which it can do if it believes “that the structure of the market or the conduct of suppliers or customers is harming competition”.
A inqury could result in the Big Six — British Gas, SSE, Npower, EDF, Scottish Power and E.ON — being broken up to improve competition.