Citizens Advice has responded to the government’s draft legislation to create a price cap in the energy market.
Gillian Guy, chief executive of Citizens Advice, said:
“The runaway costs of default energy tariffs need to be tackled, and this draft bill is an important step towards an energy market that works better for consumers. We look forward to working with the select committee and BEIS to make sure the legislation succeeds in its mission to ensure no one gets ripped off simply for being on a default tariff.
“We agree with the government that an absolute cap is a better option than a relative cap, and will help to ensure the market remains competitive so that consumers who shop around can still get a good deal.
“However, a cap on prices isn’t the end of the story when it comes to fixing the broken energy market, which is why it is vital that Ofgem takes into account the need to protect vulnerable consumers, encourage efficiency, and incentivise switching when it sets the cap. This is particularly important given the temporary nature of the measures.
“It’s also crucial that Ofgem monitors the impact of these changes closely, and is ready to take action quickly if it’s not having the intended effect on household bills.”
Citizens Advice’s analysis has found that over the last year dual fuel bills for people on the standard variable tariff rose by £89 - three times the rate of inflation.
Related information: Energy Price Cap Bill announcement
Notes to editors