New energy price cap considered

Latest news

    Electricity pylonImage copyright PA

    A price cap on energy bills could be extended to many more households on low incomes, under plans being considered by regulator Ofgem.

    A limit on the cost of gas and electricity for those on pre-payment meters already saves about four million people £80 a year.

    This could be extended to about two million others on certain benefits.

    The proposals come after a much wider cap in the Conservative manifesto was absent from the Queen’s Speech.

    Instead, the government said ministers were “considering the best way” to protect those on the poorest-value tariffs.

    Business Secretary Greg Clark wrote to Ofgem to challenge the regulator to use its existing powers to reduce bills.

    The announcement from Ofgem lists a range of proposals covering billing and switching.

    Higher bills

    Last year, a landmark investigation by the Competition and Markets Authority concluded that many households on standard variable tariffs were paying too much for their energy.

    It calculated consumers were overpaying by up to £1.2bn a year.

    This led to a cap – set regionally – on the cost of energy for those on pre-payments meters.

    Five of the “big six” energy suppliers raised prices for other customers earlier this year, despite pressure not to do so. Ofgem said such rises were not justified.

    The Conservative manifesto suggested the energy market was not working for consumers and, in a widely-debated move, suggested a tariff cap to protect 17 million people paying standard rates. This would have saved them up to £100 a year.

    However, after the election, new legislation required for the cap was missing from its plans for the next two years.

    Instead, it put the ball back in Ofgem’s court.

    Now the regulator has said it will hold a summit in July with consumer groups on how it could extend the pre-payment meter cap to other households.

    Citizens Advice has already suggested that two million extra households which receive the Warm Homes Discount should get the same protection, including some pensioners and families with young children.

    View the original article:

    Other Ofgem proposals include:

    • A trial that would allow households to enter only their postcode and current supplier into a “digital deal checker” to view the cheapest tariff
    • Requiring suppliers to inform customers of cheaper deals with rival companies, under a trial scheme
    • A clickable option on all price comparison websites to ensure customers see prices in the whole of the market, not just preferred suppliers
    • A cap on the charges levied when a pre-payment meter is installed under warrant.

    In the same category are

    GCHQ director urges co-operation after Brexit Image copyright GCHQ GCHQ played a critical role in foiling at least four European terror plots in the past year and the co-operation must continue ...
    The FBI said I was my parents’ stolen baby – but I found the truth When a one-day-old baby, Paul Joseph Fronczak, was stolen from a Chicago hospital in 1964, the terrible story made headlines across America. Then, t...
    Life after Mr Heroin Maurice Abbey Bey is a former drug user who now works in harm reduction, distributing condoms and clean needles on the streets of Washington DC. Once ...
    The Australian town that killed its residents Bronwen Duke has lost most of her family because they once lived in Wittenoom.The town in Western Australia sprang up around a blue asbestos mine in t...
    Canada legalises recreational cannabis use Image copyright AFP Image caption The Senate passed the bill, with 52 votes in favour and 29 against Canada has passed a landmark law that legalis...
    Boy Erased author Garrard Conley on surviving ‘gay conversion therapy’ Image copyright Colin Boyd Shafer Image caption Garrard Conley was forced to go through "gay conversion therapy" as a teenager It's not unusual fo...

    Leave a comment

    Your email address will not be published. Required fields are marked *

    This site uses Akismet to reduce spam. Learn how your comment data is processed.