October is the traditional time for large manufacturers to renegotiate their energy contracts, and Jeremy Nicholson, director of the EIUG, said some members were being quoted increases of up to 40% for next year.
Yet, despite the mounting crisis, Nicholson said calls on the government to mount a thorough investigation had gone unanswered.
“The Department of Trade and Industry is almost in denial about the sort of prices we face. The excuses for not taking this seriously have completely run out,” he said.
Ofgem, the energy regulator, is examining gas prices but has no authority to investigate beyond the UK market. The Financial Services Authority, which has a wider remit, is also reviewing the matter but there has been no news on what conclusions it is likely to draw.
Industry sources said it was just a matter of time before some companies might have to take the decision to shut down their plants during the winter, when prices reached their annual peak.
Advertisement
They said that, should this continue, it could also affect their decisions on whether to invest in Britain or move abroad where energy was much cheaper.
Observers have repeatedly questioned why British companies have to pay so much for gas when this country has been supplied by its own reserves in the North Sea for so long.
Although Britain will soon move to becoming a net importer of gas, companies have complained that they are already paying more than their French and German counterparts and are concerned that the market is not functioning correctly or may even be manipulated by some parties to make money.
Prices came under the spotlight last week when British Gas put customer bills up by 12.4% for gas and 9.4% for electricity.