Ofgem forces £12 off yearly electric bills

ELECTRICITY bills will drop from next spring in a new price deal, said energy regulator Ofgem last night.

news, electricity, of gem, bill, consumers, energy, prices, companies Householders will benefit from the latest plans [GETTY]

Householders could save £12 a year under plans to maintain prices for the next eight years.

The cut is driven by £2.1billion of savings made by energy companies.

Apart from Western Power Distribution, all the companies that maintain Britain’s local electricity network had to submit new business plans to Ofgem last year after the watchdog said they did not give value.

UK Power Networks, Northern Power Grid, SP Energy Networks, SSE Power Distribution and Electricity North West, have managed to shave £700million off their budgets.

A further £1.4billion was wiped off by Ofgem.

There will now be an eight-week consultation on the proposals.

In a statement the regulator said: “Today’s announcement is all part of our consistent drive to get the best deal for consumers while maintaining a stable regulatory regime.

“During the course of the price control there is expected to be an increased take up of low-carbon technologies including heat pumps, solar panels and small-scale renewable generation.”

Some customers will barely see any savings as a result, but any reduction in energy bills is good news

Stephen Murray, energy expert at MoneySuperMarket

Stephen Murray, energy expert at MoneySuperMarket, said: “Bill reductions from the network and maintenance upgrade will vary for customers using different providers and their regions.

“Therefore some customers will barely see any savings as a result, but any reduction in energy bills is good news.”

SSE said it was disappointed with parts of the plan, including assumptions about further cost reductions across the industry.

It said it is one of the UK’s most cost-efficient operators and will review how it can operate and develop its distribution networks.

Mark Todd, director of energyhelpline, said: “Good to see Ofgem turning a new leaf and forcing down prices.

“Easy money appears to have been made in this sector for far too long.”

The regulator said in addition to investment it had “challenged the companies to improve customer service and take a more active role in helping vulnerable customers”.

Companies which fail to do this will face penalties.

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