Vulnerable customer safeguard tariff

What is a vulnerable customer “safeguard” tariff?

The retail market is not working for consumers who remain on their supplier’s default deal. Our work, and the Competition and Markets Authority’s investigation, has shown there is little competitive constraint on the prices suppliers charge these customers. As a result, millions of consumers are paying more than they should be. We are particularly concerned with the impact this has on vulnerable consumers. These consumers are more likely to find themselves on a default deal, and because of their circumstances, can suffer more harm as a result.

We are implementing measures to improve competition in the retail energy market, in particular by targeting barriers to consumer engagement, which should bring benefits to most consumers. However, it will take time for these benefits to reach the most disengaged vulnerable consumers, some of whom may never be able to fully participate in the market. These consumers are suffering now, and need assistance as quickly as possible.

We therefore propose to limit tariff prices for vulnerable customers who receive the Warm Home Discount from a supplier who is required to participate in this government scheme. This will be an extension of the safeguard tariff already in place for customers who pay for their energy using a prepayment meter. 

When can I benefit from this?

We are currently consulting on the proposal – explained in the documents below.

We expect eligible consumers would benefit from this safeguard tariff by early 2018. 

We are proposing that the vulnerable customer safeguard tariff is temporary, and will fall away when the government’s price cap is implemented. 

Publications and updates

  • Published: 11th Oct 2017
  • Closing: 13th Nov 2017
  • Consultations and responses
  • 4 Associated documents
A statutory consultation that outlines our proposal to introduce a temporary safeguard tariff for consumers who are at a higher risk of being vulnerable.