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Written question asked by Kenny MacAskill (Alba Party) on Monday, 16 January 2023, in the House of Commons. It was due for an answer on Friday, 20 January 2023 (named day). It was answered by Graham Stuart (Conservative) on Friday, 20 January 2023 on behalf of the Department for Business, Energy and Industrial Strategy.

Energy: Prices

Question

To ask the Secretary of State for Business, Energy and Industrial Strategy, what discussions he has had with (a) Ofgem, (b) energy companies, (c) consumer organisations, (d) organisations advocating against fuel poverty, (e) organisations which advocate on behalf of older people and (f) other relevant stakeholders on setting a limit to the extra charges, in addition to the regular bill, which can be levied by energy companies on the bills of non-direct debit customers who pay by cash, cheque or over the phone.

Answer

Ministers and officials regularly meet with a wide range of organisations on issues relating to the energy retail market.

Suppliers incur additional costs when serving standard credit customers compared to direct debit customers, for example through additional working capital costs and administrative costs. Rules set by Ofgem mean suppliers can only charge more for one payment method than another if the price differential is cost reflective.

There are different cap levels for customers using different payment methods. This is calculated by Ofgem applying different ‘payment method uplifts’ to the benchmark of how much it costs a supplier to supply energy.

Secondary information

Type
Written question
Reference
124182
Session
2022-23
Subjects
Charities Energy Ofgem Fuel poverty Prices Utilities Consumer organisations
Link
View this Written question on www.parliament.uk