UK energy firms must pass on price savings to customers, ministers warn

theguardian.com:

Ministers have warned energy firms that they must pass on the benefits of lower wholesale prices to consumers, amid concern that bills could rise this spring.

In a speech on Wednesday, Grant Shapps will tell energy suppliers that reduced wholesale prices must be seen in consumer prices, “no ifs, buts or maybes”.

In an apparent sign of government concern about the impact of reduced direct support for domestic energy bills, the energy secretary will spell out his message in a speech at the Chatham House thinktank in London.

“I have one overriding mission in this new job: for the UK to have amongst the cheapest wholesale electricity prices in Europe,” said Shapps, whose formal brief changed from being business and energy secretary to energy security and net – zero secretary amid a mini-reshuffle and restructuring earlier in February.

“This is critical to consumers, to our country and to our planet,” he added. “Making the most of our position as a world-leaders in renewables and nuclear technology, homegrown sources that will shield households from the worst excesses of the volatile global fossil-fuel markets. And suppliers must be ready to pass those savings on to consumers.”

Ministers face pressure to postpone the reduction in support for consumer energy bills due in April, given the impact on cost of living pressures.

On Monday, the energy regulator, Ofgem, said its energy cap – the amount suppliers can charge for average dual fuel, direct debit customers – would fall by 23% for the three months from 1 April to £3,280, from £4,279 for the January to March quarter.

However, the reduction in government help means that the actual price paid by an average household will rise from £2,100 a year in April to £3,000.

Wholesale gas prices