Amidst growing resentment over the rising energy tariffs, the Energy Secretary Ed Davey will float new proposals today to ensure all households receive the cheapest gas and electricity tariffs available.

Under the Ed Davey’s new proposals, energy firms will have to offer just four core tariffs for both gas and electricity. The four core energy tariffs would be based on a fixed price for a fixed term, a standard variable rate, with two others based on different criteria such as payment method and whether renewable energy could be considered as an option or not. Energy companies would be forced to switch customers automatically to the lowest suitable tariff unless they object.

The rise in gas and electricity prices had become a long-standing concern many households are paying hundreds of pounds a year more than is necessary for gas and electricity because of the confusion in the energy tariffs. The energy companies have added to the customers’ woes in the recent years by passing on the rising wholesale prices to them.

Davey aims to clear up the confusion caused by PM David Cameron last month when he told MPs the government would compel energy firms to put people automatically on the lowest tariff. At that point, it was unclear whether it meant that consumers would be allocated the cheapest rate or just informed if there was a better offer.

At present, most people buy gas and electricity from six big suppliers, although there are smaller suppliers, amid a vast selection of energy tariffs.

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