‘Cheapest energy deal’ pledged
Energy firms will be forced to give customers the cheapest available tariff under new legislation, David Cameron has announced.
Amid mounting concern about rocketing fuel bills, the Prime Minister signalled plans to introduce new laws to tackle the often-confusing array of tariffs.
“I can announce that we will be legislating so that energy companies have to give the lowest tariff to their customers,” he told MPs during Prime Minister’s Questions.
His intervention follows a string of above-inflation price hikes by major energy companies in recent days.
Ministers have previously encouraged consumers to shop around and make sure they are on the best available deals. They have also announced moves to require energy companies to inform their customers if they could be on cheaper tariffs.
But the forthcoming Energy Bill will go further by introducing a requirement for companies to give people the best tariff for their circumstances.
The move is intended to tackle concerns that many householders, at a time of rising fuel costs, are already paying more than they need to because of the bewildering number of deals available.
Mr Cameron’s announcement came as he, Deputy Prime Minister Nick Clegg and Chancellor George Osborne were expected to hold a meeting on the Government’s energy policy today.
Did you know that there are a staggering 1,756 different energy tariffs in the UK and nearly three-quarters of customers are on the most expensive ones? That’s why, with the speed of a glacier, Ofgem has finally decided to step in and put forth proposals for a simpler, clearer energy market.
Under the regulator’s new plans, energy companies will be obliged to cut the number of tariffs to four or less, make bills more comprehensible and inform customers about the cheapest deals.
As welcome as these proposals are, they are not quite as impressive as the more robust plans announced by David Cameron earlier in the week. Unfortunately, his announcement that energy companies would be forced to put customers on the cheapest tariff was soon dismissed by the government as just one of many potential proposals that may appear on the forthcoming energy bill.
We will have to wait until the bill is published next month before we find out whether Cameron’s “option” becomes a reality, but in the meantime, Ofgem’s shake-up is, at least, a long overdue step in the right direction for consumers.
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