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Energy Bills

Volume 618: debated on Tuesday 13 December 2016

The retail energy market works well for those who are able and have the time to switch, with customers able to make savings of up to £300 by moving on to the cheapest tariffs. However, we want a market that works for all consumers, not just those who switch supplier. That is why we have been clear that we want energy companies to come forward with proposals on how they are going to treat their loyal customers fairly.

The Competition and Markets Authority has found that two thirds of households are on expensive standard variable tariffs. Does the Minister agree that suppliers should do more to ensure that their loyal customers are on better-value tariffs?

I absolutely agree with my hon. Friend. It is not right that customers are penalised for their loyalty. We want energy companies to treat all their customers fairly, and not just customers who switch between suppliers. That is why we have challenged them to come forward with proposals to ensure that all their customers get a fair deal.

I have been saying for about five years now that companies have been overcharging their customers who are on the standard variable tariff. That has been confirmed by the Competition and Markets Authority, Ofgem and the Government. The only way we will shift how those companies operate is by extending to those people on the standard variable tariff the protection we offer those on prepayment meters. Will the Minister meet me to discuss what more we can do to ensure that we give the big six energy companies a kick up the backside?

I am happy to meet the right hon. Lady, who has extensive experience in this area. We are certainly considering the CMA remedies.

A large number of rural properties are heated by oil-fired central heating. Will the Minister confirm that home efficiency measures are a vital way of cutting bills for those rural properties?

I agree with my hon. Friend. Efficiency measures are fundamental to reducing the energy bills not just for people in rural areas, but for the population as a whole.

This week, a senior Ofgem executive warned that, as a result of our higher reliance on renewable energy, consumers may face the possibility of having to pay a premium to ensure that they have a reliable source of electricity to their homes and without having their lights turned off. What discussions has the Minister had with Ofgem on that, and are the Government considering the policy of relying on costly renewable energy rather than on cheaper fossil fuels?

We have an ongoing dialogue with Ofgem on a number of issues, but apropos the cost of supporting investment in low-carbon technologies, this is expected to increase, but so too are the savings from energy efficiency policies. This means that by 2020 household energy bills are still estimated to be lower on average than they would have been in the absence of those green policies.