One of the key commitments in the Conservative Manifesto was to introduce a “safeguard tariff cap [on energy bills] that will protect customers who do not switch against abusive price rises”. This form of intervention marks a significant change in attitude to UK energy policy.
The Queen’s Speech on 21 June confirmed that the Government would bring forward “measures to help tackle unfair practices in the energy market to help reduce energy bills.” The government also signalled it was still considering the best way to achieve this.
As the government considers its options, this discussion paper contemplates the potential implications of a price cap for the way the UK energy market works, and raises some major questions that boards in the energy sector need to consider such as:
Read the full report: What would a price cap mean for the energy market.
Alternatively, our ‘Where next for retail price regulation?’ summary considers the other forms of intervention Ofgem could implement.
Continued access to the IEM will help keep bills down and maintain security of supply.