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.

PROMOTED VIDEO
News
ebooksNow available in paperback
Arts and Entertainment
Kieron Richardson plays gay character Ste Hay in Channel 4 soap Hollyoaks
tv

Regular cast member Ste Hay, played by Kieron Richardson, is about to test TV boundaries

Life and Style
tech
Life and Style
techPerils of 'text neck' revealed
News
i100
News
Stonewall CEO Ruth Hunt
peopleStonewall boss says many fear it could ruin their careers
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant - Soho

£20000 - £25000 per annum + OTE £35,000: SThree: We consistently strive to be ...

Ampersand Consulting LLP: Markit EDM (CADIS) Developer

£50000 - £90000 per annum + benefits: Ampersand Consulting LLP: Markit EDM (CA...

Carlton Senior Appointments: Director, Private Bank - San Francisco, CA

$175 - $200 per annum, Benefits: full benefits: Carlton Senior Appointments: P...

Carlton Senior Appointments: San Diego, CA – Tier 1 House - Senior MD FA

Not specified: Carlton Senior Appointments: Senior MD Financial Advisor - San ...

Day In a Page

Synagogue attack: Fear unites both sides of Jerusalem as minister warns restoring quiet could take 'months'

Terror unites Jerusalem after synagogue attack

Rising violence and increased police patrols have left residents of all faiths looking over their shoulders
Medecins sans Frontieres: The Ebola crisis has them in the headlines, but their work goes far beyond West Africa

'How do you carry on? You have to...'

The Ebola crisis has Medecins sans Frontieres in the headlines, but their work goes far beyond West Africa
Isis extends its deadly reach with suicide bombing in Kurdish capital

Isis extends its deadly reach with suicide bombing in Kurdish capital

Residents in what was Iraq’s safest city fear an increase in jihadist attacks, reports Patrick Cockburn
Underwater photography competition winners 2014 - in pictures

'Mysterious and inviting' shot of diver wins photography competition

Stunning image of cenote in Mexico takes top prize
Sir John Major: Negative West End portrayals of politicians put people off voting

Sir John Major hits out at theatres

Negative West End portrayals of politicians put people off voting
Kicking Barbie's butt: How the growth of 3D printing enabled me to make an army of custom-made figurines

Kicking Barbie's butt

How the growth of 3D printing enabled toy-designer to make an army of custom-made figurines
Will Smith's children have made waves with a gloriously over-the-top interview, but will their music match their musings?

What are Jaden and Willow on about?

Will Smith's children have made waves with a gloriously over-the-top interview, but will their music match their musings?
Fridge gate: How George Osborne keeping his fridge padlocked shows a frosty side to shared spaces

Cold war

How George Osborne keeping his fridge padlocked shows a frosty side to shared spaces
Stocking fillers: 10 best loo books

Stocking fillers: 10 best loo books

From dogs in cars to online etiquette, while away a few minutes in peace with one of these humorous, original and occasionally educational tomes
Malky Mackay appointed Wigan manager: Three texts keep Scot’s rehabilitation on a knife-edge

Three texts keep Mackay’s rehabilitation on a knife-edge

New Wigan manager said all the right things - but until the FA’s verdict is delivered he is still on probation, says Ian Herbert
Louis van Gaal: the liberal, the enemy and... err, the poet

Louis van Gaal: the liberal, the enemy and... err, the poet

‘O, Louis’ is the plaintive title of a biography about the Dutchman. Ian Herbert looks at what it tells us about the Manchester United manager
Isis in Iraq: Baghdad hails the retaking of the Baiji oil refinery as the start of the long fightback against the Islamist militants

Isis takes a big step back

Baghdad hails the retaking of the Baiji oil refinery as the start of the long fightback against the Islamist militants
Bill Cosby: America’s beloved TV ‘dad’ or serial rapist?

Bill Cosby: America’s beloved TV ‘dad’ or serial rapist?

Ukip silk bow ties, Green Party T-shirts, and 'Iron Baby' romper suits: How to shop politically

How to shop politically

Ukip silk bow ties, Green Party T-shirts, and 'Iron Baby' romper suits
The science of sex: What happens when science meets erotica

Sex on the brain

Fetishes, dominatrixes, kinks and erotica. They are subjects that should get the crowds flocking to a new exhibition at the Wellcome Collection