ondon Power users will always be rolled over to the cheapest tariff at the end of their contract – removing the risk of steep price hikes after the first year.
Sadiq Khan has launched a new energy company for Londoners, offering affordable green power in the capital.
The Mayor says switching to London Power could save the average household £300 on a fixed rate tariff.
Customers on prepayment plans could save £160 on average by switching, compared to rates from the ‘big six’ energy companies.
And London Power users will always be rolled over to the cheapest tariff at the end of their contract – removing the risk of steep price hikes after the first year.
All electricity will be renewable, although gas will not currently be from sustainable sources.
Any profit from London Power will be reinvested in the city, to tackle fuel poverty or combat climate change.
The capital spends £3.5billion on gas and electricity each year – but one in ten households is living in fuel poverty, according to National Energy Action.
With over a million Londoners struggling to pay for utilities, the charity says the problem is the worst since records began.
Newham has more fuel poverty than anywhere else in England, with almost one in five households affected.
And Brent, Waltham Forest, Haringey, Redbridge, Ealing and Harrow are also in the worst 10% nationally.
The Mayor says his new company will offer a better deal: annual fixed rate tariffs will be in the bottom 10 per cent of market prices.
Prepayment plans will always be below the price cap. The current rate is in the cheapest three on the market, 14 per cent lower than the energy pricing limit.
And London Power will have no exit fees if customers switch to another supplier.
Over 1,000 people have already registered an interest and the first customers – including Mr Khan – will switch today.
At the launch event near City Hall, the Mayor described fuel poverty in the capital as “a disgrace”.
He said: “I’ve launched London Power to give all Londoners access to a better, fairer deal safe in the knowledge that they won’t be automatically switched to a rip-off tariff when their contract ends.
“London Power is a different kind of energy company. For the first time we have a fair, affordable, green energy company specially designed for Londoners.”
Renewable Energy Association chief executive Nina Skorupska said London Power “embodies the future of energy companies in the UK”.
She said: “The interest already shown demonstrates the growing appetite amongst consumers to feel a personalised connection to their energy, knowing where it comes from and who it is benefiting.
“By adopting this model, City Hall has shown themselves to be one of the pioneers in the move towards a net zero UK.”
Octopus Energy chief executive Stuart Jackson – whose company is providing utilities for London Power – said Octopus had been “at the forefront of affordable, fairly priced green energy” since it set up shop four years ago.
He said: “We couldn’t be happier to launch London Power in partnership with the Mayor, to offer Londoners a good deal on planet-friendly power and to reinvest City Hall’s profits into community projects aimed at creating a more carbon neutral city.”