Energy bills to be simplified

Energy bills look set to be simplified as the big energy suppliers recognise the confusion that their tariffs cause.

Research from regulator Ofgem, has found that 40 per cent of consumers are completely disengaged with the energy market, as they struggle to understand their bills.

As a result, Ofgem has published a series of proposals intended to create a simpler, more competitive energy market for householders, which includes plans for tariff simplification.

Ofgem found that when it set a standing charge, and put tariffs into a comparison table, 85 per cent of consumers were able to identify the cheapest deal, compared to just 44 per cent of consumers being able to identify the cheapest tariff displayed as they are at the moment.

Energy suppliers are also recognising this, Ofgem's chief executive Alistair Buchanan said: "Encouragingly, we are seeing that major energy companies like British Gas, E.on and SSE are recognising the problems that Ofgem has identified and there is a growing sense of consensus forming behind the need for a simpler, more competitive energy market.

"Ofgem is now calling on all suppliers to back its reform programme, which gives energy suppliers a chance to draw a line under the past and an opportunity to restore consumer trust."

Ofgem claims that restoring consumers' confidence in the energy market is vital at a time when global energy prices, carbon targets and the need for investment are putting pressure on energy bills.