Energy bosses support social tariff idea

The leaders of two major energy companies in the UK have come together to advocate for the implementation of a social energy tariff to assist low-income households struggling to meet their energy bills. Chris O’Shea, the chief executive of Centrica, which owns British Gas, and E.On UK’s boss, Chris Norbury, both expressed their support for this proposal during a session with Westminster’s Energy and Net Zero Committee.

O’Shea endorsed the idea of a “progressive social tariff,” emphasising the need for a simplified and understandable energy pricing system. He suggested eliminating standing charges and zonal pricing, as well as introducing a social tariff to eliminate the disparity in costs based on geographical location. O’Shea also stressed the importance of universal smart meter installation for cost-effective energy management in the future.

Norbury echoed O’Shea’s sentiments, highlighting the inadequacy of current initiatives aimed at assisting households facing financial challenges with their energy bills. He too advocated for the introduction of a social tariff to provide much-needed support to those most in need.

Their statements were met with approval by Advice Direct Scotland (ADS), a national advice service in Scotland, which has been campaigning for the establishment of a UK-wide social energy tariff. ADS believes that an automatic opt-out scheme, placing struggling households on the most affordable energy deal, is crucial to effectively combat fuel poverty.

This policy could target the most vulnerable individuals, with eligibility determined by factors such as receipt of benefits or low income status. A recent poll revealed strong public support for this initiative in Scotland, with 66% of respondents in favour of it.

Andrew Bartlett, the chief executive of Advice Direct Scotland, commended the backing from major energy suppliers for a social energy tariff as a positive step towards addressing the challenges within the energy market. He urged for swift and concrete action to transform these discussions into tangible policies before the onset of another winter.

Bartlett highlighted the ongoing energy crisis, exacerbated by mounting household debt and soaring energy costs. He stressed the urgent need for a social energy tariff, particularly highlighting the impact on vulnerable individuals reliant on essential electric-powered medical equipment.