Bill bidding to cap poor-value tariffs

LEGISLATION designed to cap “poor-value” energy tariffs for 11 million British households was being introduced in Parliament today, the Government has announced.

The Domestic Gas and Electricity (Tariff Cap) Bill would allow Ofgem to limit tariffs until 2020, with the option to extend the cap annually until 2023.

Prime Minister Theresa May said the Bill, which the Government hopes will become law before next winter, would “force energy companies to change their ways”.

A 2016 report found consumers were paying £1.4 billion a year over the odds via energy companies’ standard variable tariffs (SVTs).

Announcing the Bill, Mrs May said: “It’s often older people or those on low incomes who are stuck on rip-off energy tariffs, so today we are introducing legislation to force energy companies to change their ways.

“Our energy price cap will cut bills for millions of families.

“This is another step we are taking to help people make ends meet as we build a country that works for everyone.”

The idea of energy price freezes was floated by thenLabour l eader Ed Miliband i n 2013 amid concerns over price hikes, and was criticised by Conservatives at the time.

Plans for a universal price cap were announced in the Conservative manifesto last year, but after the election, Mrs May passed responsibility to Ofgem, which faced criticism for only coming up with proposals vulnerable.

Frustrated by the lack of progress from the regulator, the Prime Minister announced legislation to rein in “rip-off” bills in her speech to the Tory conference in October.

A report from the Competition and Markets Authority warned in 2016 that they were contributing to £1.4bn in excess profits to energy companies.

Business and Energy Secretary Greg Clark said: “Energy prices for millions of households on default tariffs are still too high. Our new price cap will guarantee that consumers are protected from poorvalue tariffs and further bring down the £1.4bn a year consumers have been overpaying.”

After 2020, Ofgem will recommend to the Government whether the caps should be extended on an annual basis to 2023.

It will review the level the cap is set at every six months. to protect the most

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