The energy markets “typically work well” for larger businesses, according to the Ofgem’s State of the Energy report.

Ofgem found that bigger customers were negotiating better deals with their energy suppliers.

But it warned that electricity prices are 50% higher for small businesses than for larger firms.

Gas prices for smaller firms can be almost twice as high, the report added.

Big suppliers losing ground

The report found that the number of non-domestic suppliers has increased over the past year to 79 from 68.

“Most of the smallest business customers are served by one of the six largest suppliers,” Ofgem said.

“In contrast, the majority of gas sold to larger businesses is supplied by firms other than these suppliers, as is over a third of the electricity supplied to larger businesses.

“Over the past year, the six largest suppliers continued to lose ground across all non-domestic customer types.”

Ofgem’s Chief Executive Dermot Nolan said the annual report shines a light for the public, experts and stakeholders on where the market is, and where it isn’t, working for consumers.

“Energy is an essential service and so we want to ensure that the markets work in the interest of all consumers. Transparency is crucial in informing debate and policy development in the energy sector.

“It is also a report for us, Ofgem. It will help inform the way we regulate, to protect consumers now and in the future.”

> Download the report