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Labour leader promises to freeze energy prices

Labour leader promises to freeze energy prices

Category: Gas and electricity

Updated: 27/09/2013
First Published: 25/09/2013

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Labour leader Ed Miliband has promised that if his party wins the next general election in 2015 then they will freeze gas and electricity prices for 20 months.

Mr Miliband's announcement, made during Labour's annual conference, comes just days after First Utility called for the UK's big six energy firms to slash the time it takes for customers to switch suppliers to one day.

"If we win the next election in 2015, the next Labour government will freeze gas and electricity prices until the start of 2017. Your bills will be frozen, benefiting millions of families and millions of businesses," he said.

"The companies won't like it because it will cost them money. But they have been overcharging people for too long because of a market that doesn't work. It's time to reset the market."

In response, energyhelpline director Mark Todd said Labour's pledge is a step in the right direction, but he warned that energy suppliers could hike prices prematurely if Labour looks set to win power in the next election.

"This could be a hugely populist step in the right direction to lowering Britain's crippling energy bills, but the question has to be asked – will this actually save consumers any money or could it send the industry into a tailspin?" he said.

"What really needs to be set is a fair maximum price. This needs to be fair for consumers and fair for the industry so that it keeps the lights on but also stops customers being ripped off."

British Gas's managing director of residential energy, Ian Peters, meanwhile, said Government price intervention on the scale Mr Miliband is suggesting could "threaten energy security in the UK".

"If we have no ability to control what we did with the retail prices, and that (wholesale price volatility) was to happen again, it would mean we are selling products at significant amounts of a loss and that would threaten energy security in the UK," he said.

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