Government tabled new clauses to the Energy Bill today, to ensure that consumers get a better deal on their energy bills, and to press ahead with decarbonising the power sector by 2030.
The complexity and number of energy tariffs available for consumers will be reduced, and bills simplified, to deliver on the Prime Minister’s commitment to help consumers get the cheapest tariff available.
Clauses were also tabled to grant Government powers to set a 2030 decarbonisation target range for the electricity sector in 2016, once the Committee on Climate Change has provided advice on the level of the 5th carbon budget, and when the level of this carbon budget is set in law.
Secretary of State Edward Davey said:
“I am determined to ensure that consumers get the cheapest tariff they can. So, we will amend the Energy Bill to reduce the bamboozling array of tariffs available on the market and to simplify bills, whilst continuing to work with Ofgem to deliver a simpler, more competitive market.
“We will also take powers to set a decarbonisation target range for the power sector in 2016, which will provide a clear signal to industry and investors that we are serious about moving to low-carbon economy”.
The clauses tabled will reduce the number of domestic energy tariffs available and ensure that consumers cannot be left behind on poor value ‘dead’ tariffs. Bills will include clear information on the savings consumers can make by switching, and enhanced competition, choice and innovation will be encouraged in the market.
Setting a decarbonisation target range in 2016 would ensure that the range is set in the context of considering the pathway of the whole economy towards the 2050 target, and in a way that minimises costs both to the economy, and to bill payers.
Prior to this, Government will issue guidance to the National Grid on an indicative range of decarbonisation scenarios for the power sector in 2030 consistent with achieving the 2050 target at least-cost.
Finally, a clause was tabled to provide powers to enable DECC to charge fees for providing energy resilience services in the event of a disruption, or threatened disruption, to energy supplies.
Notes for editors
Full details of the reforms to retail markets will be published in the Government’s response to the discussion document in the spring of 2013.
Ofgem are committed to reviewing the implementation of their Retail Market Reforms in 2017. Government will therefore keep these powers until 2018, and set a sunset clause accordingly.