My reaction to Ed Miliband's proposal to introduce price caps on energy was not, I'm sorry to say, something that was printable in a respectable place like this. So I'll spare you that and look instead at the basic contention that is being made.

Clearly, Miliboy must believe that the energy firms are ripping off consumers if he thinks that their prices need to be capped. If they were indeed ripping off consumers then we would see it in their profits. They would be making excess returns, profits well above their cost of capital and well above the rest of the market as well.

From the FT:

Last time I looked the cost of capital to a publicly traded firm was in the 8 to 10% range. They're making around and about that return on the capital they're employing meaning that there's just no room there for excess profits. And if there are no excess profits then they cannot be unfairly ripping off the consumer.

So the whole idea falls over for lack of evidence that there is in fact the problem originally identified.