Household Bills
Government backs plans for cheaper energy tariffs
The government has backed plans by regulator Ofgem to make energy bills fairer for consumers, including forcing suppliers to reveal their cheapest tariffs.
The reforms, which are due to come into force from this summer, mean suppliers will be restricted to offering no more than four simple core tariffs for electricity and gas.
It is hoped this will put an end to the complex and confusing range of offers consumers currently have to pick through.
Suppliers will have to make electricity and gas bills clearer and show consumers the cheapest tariffs. They will face fines for breaking the rules.
Prime Minister David Cameron said:
“The package announced today is a huge step towards energy bills that are more fair for everyone. This is about putting people before profits. It’s about pensioners being better able to heat their homes in winter, and families better able to cope when the bills arrive.
“Our aim is that consumers will get the best possible energy tariff no tricks, no loopholes and we will use the powers we gained in the Energy Bill earlier this month to make sure this happens. The Bill will support this package, and make sure that all energy customers are put on their supplier’s lowest variable rate unless they choose otherwise.”
However, Which? executive director, Richard Lloyd, has criticised the proposals for not going far enough.
He said: “In a week when the regulator has warned of rising bills for years to come, this is a welcome step towards a simpler energy market that is better for consumers. But more must be done to keep costs under control for hard-pressed households who already say spiralling energy prices are their top financial concern.
“These moves will help people to get a better deal from their existing supplier but do not go far enough to increase competition and keep prices in check. Switching looks set to remain low as people will still struggle to easily spot the cheapest deal on the market so the Government must go further and require all suppliers to use a single unit price.
“If the outcome for consumers has not improved by 2015, Which? wants the Government to take a further step and guarantee a fair price for people that are put on the default tariff.”
