An energy bill price cap of £1,136 a year for “typical usage” has been proposed by the regulator, Ofgem. It says the move will mean 11 million households on default deals will save about £75 on average, although the amount households could save will depend on their usage and supplier. The planned cap will be confirmed in November, take effect at the end of December and stay in place until 2023. Ofgem said it was a “tough” cap which would give a fairer deal to consumers. The plan is that when the price cap is introduced at the end of the year, gas and electricity suppliers will have to cut their prices to the level of or below the cap. The £1,136 a year cap is based on a typical dual fuel customer paying by direct debit and the aim is to force energy companies to scrap excess charges for people on poor value default deals .
BBC 6th Sept 2018 read more »
The energy price cap could increase by more than £100 a year in the spring despite Theresa May’s promise that the policy would prevent big price rises, experts have warned. Ofgem, the energy regulator, published proposals yesterday to prevent energy firms charging a typical household more than £1,136 a year and saving them £75 on average. The cap would come into force at the end of the year. However, rising wholesale gas and electricity costs could force the regulator to increase the cap again in April by as much as £123 a year, analysts said, wiping out the initial saving.
Times 7th Sept 2018 read more »
You might imagine news of a far-reaching price cap set to cost energy firms a cool £1bn would provoke a fierce rebuke from the companies and a sea of red share prices across the sector. But, after months of wrangling, the mood was more of resignation and relief when industry watchdog Ofgem set out the details of its “tough” new rules on Thursday. The cap will affect the 11m of Britain’s households that are currently paying so-called standard variable tariffs (SVTs), the default rates paid by the majority of us who haven’t shopped around for a new energy deal in recent years. “Typical” customers will see their annual bill for gas and electricity cut by £75 to £1,136, with those on particularly high tariffs expected to save significantly more under the plans, which are set to come into force by the end of the year.
Telegraph 6th Sept 2018 read more »
Labour’s Rebecca Long-Bailey, the shadow business secretary, said that while the price cap was a start, it was less than had been promised. “Theresa May promised 17m households would be better off by up to £100. Today’s announcement is a smaller saving for fewer people. Despite promises from the prime minister, the government has continued to sit on their hands while the big six have hiked prices. “Tory dithering means that millions of customers will now be even worse off than when Theresa May first made her promise.”
Guardian 6th Sept 2018 read more »