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Costs between best and worse energy tariffs widen to over £100 on average, report shows
Aug. 7, 2017
The price gaps between the biggest energy companies’ fixed tariff deals and standard variable tariffs has increased by more than half following a series of price hikes that took place during the winter.
A report shows that the difference between suppliers’ least expensive fixed rate deal and the costliest standard variable tariff has widened on average from £70 in November 2016 to £109 in June 2017.
In May this year, Theresa May announced it was time to intervene on the energy markets, promising a price cap on standard variable tariffs to save households up to £100 annually on their energy bills.
However, it has transpired that instead of introducing a price cap, the government proposes to extend a price cap for vulnerable customers.
Conservative Party critics argue that the energy cap ‘U-turn’ falls considerably short of the government’s election promises and that millions of UK households have been betrayed.
A Department of Business, Energy and Industrial Strategy spokesperson spoke of the importance in providing a better energy deal for consumers, stating:
“Energy customers should not be punished for their loyalty… We now want to see suppliers playing their part and supporting the regulator to deliver a fairer deal to customers on poor value tariffs.”
Though despite pinning rising energy prices on the biggest energy suppliers, the government recently admitted that due to giving the cement, ceramics and steel sectors a £100million exemption from subsidising renewable energy projects, the average annual energy bill of dual fuel will increase by £2.30 by 2018.
A report by the Green Alliance titled ‘Negotiating Brexit: Positive Outcomes for the UK on Energy and Climate’, also warns the cost of energy in the UK may increase if Britain leaves the EU internal energy market as part of Brexit negotiations.
According to Green Alliance:
“Electricity interconnection with the EU meets 7% of UK’s electricity needs and keeps energy bills down.”
With Brexit uncertainty, the government seemingly back-peddling on energy price cap promises, and reports warning that, due to recent price hikes, the worse and best energy tariffs look set to widen, energy customers, both domestic and commercial, would be wise to keep a close eye on the market and make any necessary changes to help keep their energy costs down.
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