Critics pour cold water on tariff plans

Energy Secretary Ed Davey lit the touchpaper on plans to prevent energy firms offering more than four tariffs and to "require" them to automatically move customers on to the cheapest one.

The issue has been on the front burner since foot-in-mouth David Cameron told the Commons: "We will legislate so that energy companies have to give the lowest tariff to their customers."

The announcement caught the Department for Energy and Climate Change off guard and new Energy Minister John Hayes - called to the Commons to make the issue clear - spluttered that there were "a number of options."

Now Mr Davey has issued a discussion document on proposals and when directly asked by BBC news presenter Matthew Amroliwala if they were going to be compulsory on the companies he said: "Yes."

Many cash-strapped families are already paying more than necessary for gas and electricity because of the confusing array of different tariffs and an inquiry has been called into the wholesale gas market.

Shadow energy and climate change secretary Caroline Flint said: "The cheapest deal in an uncompetitive market will still not be a good deal.

"Unless David Cameron stands up to vested interests in the energy market and creates a tough new watchdog with powers to force energy companies to pass on price cuts, his warm words will be cold comfort."

Even Guy Newey, head of energy and environment at right-wing think tank Policy Exchange, said: "This risks punishing families who do the right thing and shop around.

"There is a danger this move could see fewer people switching, reduce competition and push up bills in the long term. A 'one size fits all' energy market is not the way to do it."

Energy UK chief executive Angela Knight, representing the energy companies, warned that government proposals could mean the end of some of the cheap deals currently on offer.

Of the "Big Six" energy firms five have recently increased prices or announced they will be raising them in the next month. German-owned Eon is reportedly planning one soon.