Ofgem proposals are set to add money to domestic energy customers’ bills, who will shell out an average £3 more on gas and electricity between April 2012 and March 2013 due to new network charges.
The regulator has unveiled plans to cap profits earned by the four electricity and gas transmission operators at 4.75 per cent of turnover during the 12-month period.
This is down from the 5.05 per cent under the existing system.
The watchdog commented: "We propose to reduce the allowed return to 4.75 per cent ... This is based on our view that the cost of debt has reduced by 50 basis points to 3.25 per cent."
From 2013, Ofgem will be rolling out a new RIIO system to make the network more sustainable, which it claims will save energy customers £1 billion over eight years.
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