Britain's competition watchdog wants to introduce temporary price controls for four million households which are on pre-payment meters, as it laid out sweeping reforms aimed at injecting more competition into Britain's energy market.
This would cut bills by a total of £300m a year and will remain in place until 2020, the Competition and Markets Authority (CMA) said.
It also wants to give energy watchdog Ofgem control of a database which would allow rival suppliers to contact customers who have been stuck on their supplier's default tariff for three years.
It follows an 18-month investigation into whether Britain's big six energy suppliers – SSE, Iberdrola's Scottish Power, Centrica, RWE npower, E.ON and EDF Energy – were providing enough competition in the market.
Energy companies had campaigned for the regulator's initial findings announced in July to be softened. The CMA was mulling a temporary cap on default tariffs, which make up about 70 per cent of the market.
Shares in SSE were down 0.5 per cent to 1,459p, RWE fell 1.3 per cent to €10.54, E.On slumped 0.2 per cent to €8.1 and EDF shares were down 1.4 per cent to €9.76 in late morning trading.
Bu London-listed National Grid rose 0.7 per cent to 966.9p per share, while Centrica shares swelled 1.2 per cent to 229.8p.
“ We have found that the six largest suppliers have learned to take many of their existing domestic customers … for granted," Roger Witcomb, chairman of the energy market investigation, said.
“In those parts of the retail markets where competition is working, customers are benefiting to the tune of hundreds of pounds a year by switching."
“We’re proposing a wide range of bold, innovative measures to enable competition to grow further across the market so that millions more households will benefit.”
The CMA said that, in total, customers could've been paying £1.7bn a year more than the would in a competitive market.