Energy regulator Ofgem will "break the stranglehold" of the big six energy firms by allowing independent suppliers to compete effectively, under new proposals unveiled today.
Ofgem is seeking to increase competition in the energy market by creating "a more level playing field" for independent suppliers.
It wants wholesale energy prices to become more transparent, with the big six having to publish their prices two years in advance. The big six will also have to ensure they sell power to independent suppliers "at a fair price".
The big six energy companies are British Gas, EDF, Eon, Npower, Scottish Power and Scottish and Southern Energy (SSE).
The proposed rules will become part of licensing conditions for energy companies – meaning if any energy firm breaks them, Ofgem will have the power to fine them.
Andrew Wright, senior partner for markets at Ofgem, said: "Our aim is to improve consumer confidence and choice by putting strong pressure on prices through increased competition in the energy market."
Ofgem said it expects the changes to be in place early next year, but energy secretary Ed Davey has asked energy companies to work with Ofgem to introduce the proposals as soon as possible.
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He said: "I want our energy market to be as competitive as possible. An increased role and level playing field for independent suppliers and generators is precisely what will help drive the competition that delivers better value for consumers and businesses."
Ann Robinson, director of consumer policy at Uswitch, said the proposals were the "shot in the arm" the energy market needed.
She added: "Today's move should pave the way for new suppliers to come into the market, creating more choice and competition, which should ultimately translate into lower prices for consumers."