The UK Government has set out the draft legislation to cap energy prices.
The Bill would see “rip-off” energy prices capped temporarily for millions of householders on standard variable tariffs (SVTs) and default tariffs that customers are moved onto at the end of a fixed-term deal.
Around two-thirds of energy customers in Britain are on those tariffs, i.e. 18 million customer accounts – four million of which are on prepayment meters and are currently protected by a price cap.
The new cap to be set by Ofgem would apply until 2020, with the potential to be extended by up to three years if needed. It won’t however come into effect before the end of the year, the regulator said.
The draft Domestic Gas and Electricity (Tariff Cap) Bill will now be scrutinised by the Business, Energy and Industrial Strategy Select Committee.
Prime Minister Theresa May said the “broken energy market has to offer fair prices for millions of loyal customers who have been paying hundreds of pounds too much”.
Business and Energy Secretary Greg Clark added: “We have published a draft legislation today, sending a clear message to the industry that we will protect the interests of their customers if they do act now to tackle the detriment found by the Competition and Markets Authority.”
Energy prices will be part of the discussions at Energy Live Expo on 2nd November at the QEII in London. There are limited free tickets for energy end users.