Thursday 19 July 2018

Energy price cap to become law this winter

Energy price cap to become law this winter

The legislation to cap poor value energy tariffs in the UK has passed through Parliament.

The Domestic Gas and Electricity (Tariff Cap) Bill will put in place a requirement for regulator Ofgem to cap standard variable and default energy tariffs.

The government said the energy price cap will become law this winter and protect 11 million households from increases in tariffs.

It will be in place until 2020 when Ofgem will recommend if the cap should remain on an annual basis up to 2023 – the regulator will review it at least every six months while it is in place.

Business and Energy Secretary Greg Clark said the Bill is a “necessary intervention” to protect millions of energy customers who have been stuck on poor value deals and “hit by unjustified prices for far too long”.

All the Big Six suppliers and some smaller and medium-sized companies have increased energy prices this year.

The latest news follows the Competition and Markets Authority’s (CMA) investigation into the energy market, which found consumers supplied by the Big Six companies are overpaying by an average of £1.4 billion a year.

Some consumers could save up to £350 annually on gas and electricity if they switch suppliers.

Prime Minister Theresa May added: “For far too long, older people, hard-working families and those of low incomes have been subject to rip-off energy tariffs. Our energy price cap will protect households from unfair price rises in time for this winter when people can feel the pinch more acutely.

“We know that the cost of living is still a challenge for some families and today marks an important step in helping people to keep more money in their pockets.”

Written by

Bruna Pinhoni

Trending Articles