Power suppliers will have to offer same price for all

Power suppliers were facing a further clampdown yesterday after being warned that they would not be allowed to pass the windfall tax on to consumers and would have to offer the same prices to all customers when full competition hits the electricity and gas markets next year.

John Battle, the Energy Minister, made it clear that suppliers would not be allowed to cherry-pick the most lucrative customers by offering special discounts only to those paying by direct debit.

Meanwhile, Professor Stephen Littlechild, the electricity industry regulator, said he would not be prepared to amend price controls to allow the cost of the windfall levy to be met through higher bills. "I don't start with the presumption that I need to do that. The aim of the levy is not to tax customers," he said.

Mr Battle's move follows growing concern at the wide differences in charges in competitive gas trial areas between poorer households on pre-payment meters and those who pay by direct debit. Tariffs from one independent supplier were 34 per cent lower for direct debit payers than for those with pre-payment meters, compared with a 14 per cent spread with British Gas Trading.

Mr Battle said the threat of "fuel poverty" was still a very real issue. "Social obligations must not be allowed to fall between the cracks ... If competition doesn't deliver a better deal for those who need it most I do not believe it will have delivered at all."

He said he had already told Professor Littlechild to start a review in the electricity market and would be doing the same with Clare Spottiswoode, the gas regulator.

Mr Battle also told the regional electricity companies they risked a crisis of confidence if they made a mess of introducing competition into the domestic market. "Those targets were set eight years ago. I want them to be met. I want no wrong bills and I want the timetable to be met." He said RECs that were not ready next year would face tough financial penalties, while those that succeeded would receive rewards.

Jim Forbes, chief executive of Southern Electric, insisted it was more important to ensure no customers were hit by computer billing problems. "If it's six or seven months late it's still a triumph for the UK because it takes us years ahead of the rest of the world." Southern said its computer systems would be ready for testing in January 1998, despite being singled out by the regulator last week for not keeping up with the timetable.

Southern yesterday blamed an 11 per cent drop in profits to pounds 255.5m on price controls from the regulator and higher interest charges associated with last year's share buyback. The grouppledged to spend pounds 100m on seven small gas generating plants.

Meanwhile Offer's annual report for 1996 shows that although complaints continue to fall nationally they rose by 25 per cent in the case of three RECs - Northern, Norweb and London. In Northern's case, complaints have increased for three years running. Professor Littlechild said he had asked Northern, Swalec and London to demonstrate how they intended to improve performance after a doubling in complaints about quality of supply.

The total number of disconnections meanwhile fell by 43 per cent to 477 with all regions apart again from Northern reporting a decrease.

Start your day with The Independent, sign up for daily news emails
Life and Style
Steve Shaw shows Kate how to get wet behind the ears and how to align her neck
healthSteven Shaw - the 'Buddha of Breaststroke' - applies Alexander Technique to the watery sport
Arts and Entertainment
The sight of a bucking bronco in the shape of a pink penis was too much for Hollywood actor and gay rights supporter Martin Sheen, prompting him to boycott a scene in the TV series Grace and Frankie
footballShirt then goes on sale on Gumtree
Terry Sue-Patt as Benny in the BBC children’s soap ‘Grange Hill’
voicesGrace Dent on Grange Hill and Terry Sue-Patt
Arts and Entertainment
Performers drink tea at the Glastonbury festival in 2010
Arts and Entertainment
Twin Peaks stars Joan Chen, Michael Ontkean, Kyle Maclachlan and Piper Laurie
tvName confirmed for third series
Cameron Jerome
footballCanaries beat Boro to gain promotion to the Premier League
Arts and Entertainment
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Neil Pavier: Management Accountant

£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...

Sheridan Maine: Commercial Accountant

£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...

Laura Norton: Project Accountant

£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...

Day In a Page

Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine