Millions May See Energy Bills Cut Under Reforms
Millions of households with pre-payment meters may see their energy and gas bills cut under changes to the UK’s energy sector expected to be announced today.
The proposed reforms are expected to be revealed as the Competition and Markets Authority (CMA) publishes the results of a two-year investigation into the energy sector.
The CMA is likely to recommend the introduction of a price cap for low income and vulnerable customers using pre-payment meters, or around 16% of households.
The report will also outline proposals to encourage customers to switch providers in a move designed to break the dominance of the Big Six – British Gas, SSE, EDF Energy, npower, E.ON and Scottish Power.
The CMA estimates that customers have been overpaying some £1.2bn a year, or around £40 per household.
The Big Six providers may also be forced to share customer data under the reforms so rival companies can contact households directly about energy and gas deals.
But plans mooted last July for a maximum price limit for standard variable rate tariffs are expected to be scrapped in the report.
The move would have seen prices slashed or frozen for around 70% of customers with the Big Six providers.Last July the CMA found that there was “widespread consumer disengagement” in and argued that customers should be encouraged to seek better deals.