Five million households to 'save £115 a year' under new safeguard energy tariff
Energy watchdog Ofgem said it had extended its safeguard tariff to almost one million vulnerable customers, taking the total number of households protected on the tariff to more than five million.
The regulator said these households will initially save around £115 on average a year under the tariff, which stops suppliers from charging customers too much and ensures any price increase is justified by rises in underlying costs.
But it said the savings will fall to £66 a year from April when the level of the safeguard will drop due to rising gas and electricity costs.
Ofgem insisted that customers on the safeguard tariff would still be better off despite the price hike.
Dermot Nolan, chief executive of the watchdog, said: "Protecting vulnerable customers is a priority for Ofgem.
"That's why we have extended the prepayment safeguard tariff to almost one million vulnerable households, which will help deliver a fairer, smarter and more competitive market for all consumers.
"Even when energy costs rise, people on the worst deals are better off under the safeguard tariff as they can be sure that they are not overpaying for their energy and any rise is justified."