This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at http://www.bbc.co.uk/news/business-41592200
The article has changed 8 times. There is an RSS feed of changes available.
| Version 0 | Version 1 |
|---|---|
| Energy price cap plans to be published | Energy price cap plans to be published |
| (35 minutes later) | |
| Draft legislation designed to lower the cost of energy bills is set to be published by the government later. | Draft legislation designed to lower the cost of energy bills is set to be published by the government later. |
| The Draft Domestic Gas and Electricity (Tariffs Cap) Bill will give energy regulator Ofgem the power to cap standard variable tariffs. | The Draft Domestic Gas and Electricity (Tariffs Cap) Bill will give energy regulator Ofgem the power to cap standard variable tariffs. |
| At present about 18 million customers are on some form of default tariff, which can cost hundreds of pounds a year more than the cheapest deals. | At present about 18 million customers are on some form of default tariff, which can cost hundreds of pounds a year more than the cheapest deals. |
| But the price cap is unlikely to take effect before winter. | But the price cap is unlikely to take effect before winter. |
| The cap will be short term, until 2020, and possibly extended to 2023 if Ofgem decides that is necessary, the government said in a statement. | |
| 'Peace of mind' | |
| Prime Minister Theresa May said: "I have been clear that our broken energy market has to change - it has to offer fairer prices for millions of loyal customers who have been paying hundreds of pounds too much. | Prime Minister Theresa May said: "I have been clear that our broken energy market has to change - it has to offer fairer prices for millions of loyal customers who have been paying hundreds of pounds too much. |
| "Today's publication of draft legislation is a vital step towards fixing that, and in offering crucial peace of mind for ordinary working families all over the country." | "Today's publication of draft legislation is a vital step towards fixing that, and in offering crucial peace of mind for ordinary working families all over the country." |
| Business and Energy Secretary Greg Clark said that customers of the big six energy suppliers were "overpaying to the tune of £1.4bn a year". | Business and Energy Secretary Greg Clark said that customers of the big six energy suppliers were "overpaying to the tune of £1.4bn a year". |
| "That is simply wrong. While five million households will see their bills capped from this winter, I want to see every household protected from rip off bills." | "That is simply wrong. While five million households will see their bills capped from this winter, I want to see every household protected from rip off bills." |
| He added that the draft legislation would send a "clear message to suppliers they must act to put an end to loyal consumers being treated so unfairly." | He added that the draft legislation would send a "clear message to suppliers they must act to put an end to loyal consumers being treated so unfairly." |
| Harming competition? | |
| However, Steve Smith, director of energy switching firm Flipper and former Ofgem board member, said a cap was "quite likely" to push up fixed fees. | |
| "A regulated price means people will switch off and think 'the government's looking after me'," he told the BBC. | |
| He said it was clear that Ofgem was being told to implement the cap by the government, but the cap went against the advice of the Competition and Markets Authority. | |
| "It could actually do harm to competition and means many customers will end up paying a lot more. | |
| "If two-thirds of the market is covered by a cap you start to question whether it's a market at all." | |
| The plan to cap energy charges was revived last week by Mrs May. | The plan to cap energy charges was revived last week by Mrs May. |
| However, Ofgem said on Wednesday that it would have to wait for legislation to be in force before it could take action on standard variable tariffs. | However, Ofgem said on Wednesday that it would have to wait for legislation to be in force before it could take action on standard variable tariffs. |
| The draft legislation will be scrutinised by a select committee of MPs. This is designed to build cross-party consensus on how the price cap will work. | The draft legislation will be scrutinised by a select committee of MPs. This is designed to build cross-party consensus on how the price cap will work. |