Energy: Prepayment charges reform needed

The energy sector appears to have accepted the chancellor's call for changes to prepayment meter charging.

Alistair Darling said he wanted to see a "fairer deal" for the five million customers on prepayment meters, calling on energy companies to treble the amount they spend on social tariffs to £150 million.

EDF Energy said it welcomed Mr Darling's demand, backing its preferred mandatory social tariff in the form of a discount or relief to "ensure a level playing field" among suppliers.

And Adam Scorer, campaigns director at Energywatch, said some form of minimum requirement would be needed across the board.

But he warned: "One thing the government should have learned by now is that relying on voluntary action by suppliers will not deliver the goods."

Smart meters received a positive welcome, with the Carbon Trust pointing to their viability in saving 2.5 million tonnes of CO2 emissions a year.

Renewable energy stakeholders responded more cautiously, however. The Environmental Industries Commission criticised Mr Darling's removal of the 20p per litre duty incentive, saying it would make UK investment in biofuels "very difficult".

But the British Wind Energy Association's Adam Bruce said the government was beginning to understand the potential of renewable energy, pointing to Mr Darling's commitment to introduce carbon budgeting this time next year.