PBR on energy: Statutory power 'great news' as previous threats fell on 'deaf ears'

25 November 2008 / by Rachel Mason
James Caldwell, director of Fairinvestment.co.uk comments on news that the Government may introduce statutory powers to cut energy bills:

"Energy bills increased by nearly 30 per cent in the 12 months up to September 2008, and Gordon Brown's previous threats to energy companies to cut their prices seemed to have fallen on deaf ears.

"In the pre-Budget report, Alistair Darling has made a big step in the right direction. He has said that clear and transparent information is needed for all consumers so that they can manage their own energy costs through engaging effectively with the energy market and has asked Ofgem to publish quarterly reports so that the Government can see the relationship between what the energy companies are paying and what they are charging.

"This means that if the Government can see that energy companies are not reflecting the fall of wholesale energy in reduced gas and electricity bills that he will "use statutory power to end unjustifiable pricing differentials," and this is great news for consumers.

"Energy companies will no longer be able to hide their profits which will in turn increase competition once more in the energy market. Consumers will be able to shop around, compare energy prices and pick the one that really does give them the best deal.

"The Chancellor has also announced a 70 per cent increase in installation rates for cavity wall and loft insulation this winter. This still falls far short of where we should be – there are around three million households in 'fuel poverty' and this will help just 60,000 – but it is a start.

"It will help reduce carbon emissions and could save thousands of families £100s on their bills which could really make a difference to their tight household budgets."