Pensioners pay the price for OFGEMS failure to get reforms right
PENSIONERS will unfortunately pay the price for OFGEM’s failure to improve the UK’s energy pricing system after E.ON announced it was pulling the plug on its discounted tariff for over-65s, according to the Energy Advice Line.
It was now clear the energy regulator needed to urgently review its proposed reforms as tens of thousands of pensioners face a price hike following E.ON’s decision to scrap its StayWarm deal, which offered fixed-price energy for older customers based on average consumption. The deal will close as current contracts come to an end from October 7th 2013.
OFGEM is currently reforming the UK’s household and business electricity and gas market with a view to simplifying bills, including limiting the number of tariffs suppliers can offer and introducing an APR-style rate so that consumers can compare deals more simply.
However, E.ON has blamed OFGEM for its decision to scrap the StayWarm deal, claiming it can no longer offer the tariff due to the restrictions on the number of products it is allowed to offer. Based on this it is pretty clear that OFGEM’s proposal’s to simplify bills by limiting the number of tariffs is not going to work.
Failure to enforce their reforms means that OFGEM are unable to help pensioners
Suppliers like E.ON will simply blame OFGEM for scrapping offers like StayWarm and pensioners, who can least afford a price hike, will end up paying the price. Energy Advice Line have warned OFGEM that its reforms do not actually address the root causes of the UK’s bewilderingly complex energy pricing system. We have also warned that these reforms might in fact lead to the most vulnerable consumers paying more for their energy.
Restricting the number of tariffs and introducing an APR-style rate are not enough. What is needed is a simple system that enables a consumer to compare what they are actually paying with one supplier against what they would be paying if they switched suppliers.
It cannot be beyond the wit of suppliers and Ofgem to work that out. Consumer watchdog Which? has also criticised OFGEM’s plans, and called for simple tariffs, without standing charges, to be displayed in the style of petrol forecourt prices, to make it easier to spot the cheapest deal.
Energy Advice Line urges pensioners confused about what E.ON’s decision will mean for them to get in touch. We would be happy to help anyone who believes they might be affected by E.ON’s decision to scrap the StayWarm tariff to get in touch and we will do what we can to help by offering very competitive fixed term contracts that will not just deliver on price but also guarantee the rate for a fixed period of time to protect the vulnerable from future price rises during the duration of the contract.
Now is the time to lock into the best available deals, ahead of winter price hikes,Business Electricity Comparison and would be happy to advise over-65s of their options. The service is free, so there is nothing to lose.
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