London Daily

Focus on the big picture.
Thursday, Sep 25, 2025

Cost of living: Social energy tariff needed for families that can't pay bills even with government help, Ofgem says

Cost of living: Social energy tariff needed for families that can't pay bills even with government help, Ofgem says

Ofgem chief executive Jonathan Brearley said the tariff would have to be subsidised during periods of high energy prices, and otherwise paid for with "funds raised in a progressive way".
The government should introduce a "social tariff" guaranteeing cheaper energy to vulnerable users who cannot afford their basic needs, the chief executive of regulator Ofgem has said.

Speaking as Ofgem launched an investigation into energy suppliers imposing prepayment meters on struggling households, Jonathan Brearley said the current high-cost energy market left some households simply unable to pay.

Ofgem's investigation comes after Business Secretary Grant Shapps wrote to energy suppliers raising concerns over an increase in customers forced to move to prepay meters having fallen behind on regular payments.

Companies could face legal action if Ofgem determines they have moved customers to prepayment without exploring other options to support them.

Mr Brearley said action was needed to address the fundamental problem caused by the tripling of gas prices in the last year.

"There are families that can't afford to pay their energy bills and we will be active with companies to examine how they deal with those who fall into arrears," Mr Brearley said.

"But the root cause is that some customers, despite enormous widespread support from the government, don't have the ability to pay for their basic energy needs.

"We think there's a case to examine with urgency a social tariff that limits the impact of extremely high prices, which reduces the volatility for a defined set of vulnerable groups."

Mr Brearley said the tariff would have to be subsidised during periods of high energy prices, and otherwise paid for with "funds raised in a progressive way", adding that "energy bills are not a progressive tax base".

His intervention comes after charities called on Chancellor Jeremy Hunt to consider a social tariff to address the growing number of people for whom energy is becoming unaffordable.

Citizens Advice estimates 3.2 million customers were left in cold and dark homes last year after running out of credit.

Mandatory prepayment meters are intended as a last resort for customers who suppliers believe are refusing to pay rather than simply unable and should only be used after exploring the financial help available.

Concerns over spike in prepayment meter warrants

Ofgem says there has been a spike in the number of forced installations or customers being switched via smart metres in recent months.

"I am concerned about the sharp growth in households struggling to pay their bills being switched over to prepayment meters, sometimes without their even knowing about it, leaving them without heating," Mr Brearley said in a speech at the Institute for Government on Monday.

"I have heard directly from people who have faced poor practice from suppliers. It is simply not acceptable that vulnerable customers are left in the dark and cold in winter."

The withdrawal of Russian gas from European supply, increased competition for alternative sources, and a reduction in output from the French nuclear fleet have combined to drive up wholesale gas prices, which effectively set the base rate for electricity production.

While the market has settled since last summer Mr Brearley said there is no prospect of a return to lower prices that were normal before the coronavirus pandemic.

"Mild weather, improved storage in Europe, and a more benign trading environment... has led to a challenging but more robust energy security position," he said.

"But prices are unlikely to fall back to pre-pandemic levels... we need to be ready for a world where prices are high and volatile."
Newsletter

Related Articles

0:00
0:00
Close
Shock in France: 5 Years in Prison for Former President Nicolas Sarkozy
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
BNP Paribas Abandons Ban on 'Controversial Weapons' Financing Amid Europe’s Defence Push
Typhoon Ragasa Leaves Trail of Destruction Across East Asia Before Making Landfall in China
The Personality Rights Challenge in India’s AI Era
Big Banks Rebuild in Hong Kong as Deal Volume Surges
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Arnault Denounces Proposed Wealth Tax as Threat to French Economy
Study Finds No Safe Level of Alcohol for Dementia Risk
Denmark Investigates Drone Incursion, Does Not Rule Out Russian Involvement
Lilly CEO Warns UK Is ‘Worst Country in Europe’ for Drug Prices, Pulls Back Investment
Nigel Farage Emerges as Central Force in British Politics with Reform UK Surge
Disney Reinstates ‘Jimmy Kimmel Live!’ after Six-Day Suspension over Charlie Kirk Comments
U.S. Prosecutors Move to Break Up Google’s Advertising Monopoly
Nvidia Pledges Up to $100 Billion Investment in OpenAI to Power Massive AI Data Center Build-Out
U.S. Signals ‘Large and Forceful’ Support for Argentina Amid Market Turmoil
Nvidia and Abu Dhabi’s TII Launch First AI-&-Robotics Lab in the Middle East
Vietnam Faces Up to $25 Billion Export Loss as U.S. Tariffs Bite
Europe Signals Stronger Support for Taiwan at Major Taipei Defence Show
Indonesia Court Upholds Military Law Amid Concerns Over Expanded Civilian Role
Larry Ellison, Michael Dell and Rupert Murdoch Join Trump-Backed Bid to Take Over TikTok
Trump and Musk Reunite Publicly for First Time Since Fallout at Kirk Memorial
Vietnam Closes 86 Million Untouched Bank Accounts Over Biometric ID Rules
Explosive Email Shows Sarah Ferguson Begged Forgiveness from Jeffrey Epstein After Taking His Money
Corrupt UK Politician Ed Davey Demands Elon Musk’s Arrest for Supporting Democracy
UK, Canada, and Australia Officially Recognise Palestine in Historic Shift
Alibaba Debuts Open-Source Deep Research Agent with Benchmarks Rivaling OpenAI
Marcos Faces Legacy-Defining Crisis as Flood Projects Scandal Sparks Massive Tide of Protests
China’s Micro-Drama Boom Turns Stalled Real Estate Projects into Lavish Film Sets
New Eye Drops Show Promise in Replacing Reading Glasses for Presbyopia
'Company Got 5,189 H-1B Visas, Then Laid Off 16,000 Americans': US Defends New $100,000 H-1B Visa Fee
Golf legend tells Omar she should be 'sent back to Somalia' after her Kirk comments
EU Set to Bar Big Tech from New Financial Data Access Scheme
China Bans Livestreaming and AI in Religion Amid Crackdown on Shaolin Temple Scandal
Documents Reveal Mandelson Failed to Declare Epstein-Funded Flights as MP in 2003
Dubai Property Boom Shows Strain as Flippers Get Buyer’s Remorse
Harris Memoir Sparks Backlash from Democrats for Blunt Critiques in ‘107 Days’
Germany Weighs Excluding France from Key European Fighter Jet Programme
Cyberattack Disrupts Check-in and Boarding Systems at Major European Airports
Japan’s ‘Death-Tainted’ Homes Gain Appeal as Prices Soar in Tokyo
Massive Attack Withdraws from Spotify Over Daniel Ek’s €600M Defence-AI Investment
Björn Borg Breaks Silence: Memoir Reveals Addiction, Shame and Cancer Battle
When Extremism Hijacks Idealism: How the Baader-Meinhof Gang Emerged and Fell
Top AI Researchers Are Heading Back to China as U.S. Struggles to Keep Pace
JWST Data Brings TRAPPIST-1e Closer to Earth-Like Habitability
Trump Orders Third Lethal Strike on Drug-Trafficking Vessel as U.S. Expands Maritime Counter-Narcotics Operations
Trump Orders $100,000 Fee on H-1B Visas and Launches ‘Gold Card’ Immigration Pathway
Why Google Search Is Fading and AI Is Taking Its Place
×