Ofgem Announces 'Fuel Poverty-Reducing' Move

Social tariffs for Britain's "fuel poor" must be in line with the cheapest deals on the market, the energy watchdog has demanded.

Ofgem said in a report released today that it has set down new rules, precluding providers from undercutting their social deals with cheaper internet offers. It is hoped that this move will help to lessen fuel poverty, commonly defined as when a household spends more than ten percent of income on gas and electricity.

"Previously some suppliers' social tariffs were not as good as their internet tariffs which were the cheapest deals around," said an Ofgem spokesman.

However, the move was criticised by Energywatch, another watchdog. Speaking to the BBC, a spokesman said: "The guidance has not addressed the confusion that fuel poor consumers can face on whether they are eligible for their suppliers' social tariff and will not ensure that all those who need such assistance are eligible for these tariffs."

Meanwhile, the rising wholesale costs of gas and electricity continue to take their toll on general energy tariffs, with EDF announcing today that it will hike customer bills. The changes, which come into effect today, see a 22 percent increase in gas prices and a 17 percent rise in electricity.

Figures released by the provider - which retains around 5.5 million customers in the UK - suggest that wholesale costs have increased by 70 percent for coal, 63 percent for gas and 47 percent for electricity since the New Year, when it last raised prices.

With both British Gas and Scottish & Southern, Britain's two biggest providers, announcing recently that they will also hike bills in the near future, it seems likely that costs of energy will rise across the board over the weeks to come.