The government has revealed plans for energy prices to be capped until 2020.
The new legislation comes in the form of the Draft Domestic Gas and Electricity (Tariffs Cap) Bill, and will give the energy regulator Ofgem the power to cap tariffs.
On the advice of Ofgem, the cap could be extended to 2023. The government said in a statement its necessity would be kept under review.
Around 18 million households in the UK are on an uncapped tariff. The market watchdog stated that these households are collectively spending £1.4 billion more a year than they need to.
Theresa May said “our broken energy market has to change – it has to offer fairer prices for millions of loyal customers who have been paying hundreds of pounds too much”.
A softer, relative price cap would have put May in greater favour with energy companies and some Conservative MPs who are against intervention in free markets.
The cap is not likely to come into effect until spring 2019, meaning British households have another two winters to get through on the current system.