Energy bills rise 'to fund the French'

Families in Britain could be stung with higher energy bills because the French government is capping price rises for households in France, MPs warned today.

French president Nicolas Sarkozy has ordered a two per cent limit on an increase in electricity prices and five per cent for gas. But French energy giant EDF raised its gas tariff in Britain by 22 per cent two weeks ago and electricity by 17 per cent.

MPs have warned that the UK is losing out in the partially liberalised energy market in the EU and fear that companies like EDF could be seeking to make more profits here than in other countries with more State controls.

Steve Webb, Liberal Democrat energy spokesman, said: "EDF will have to make up the shortfall somehow.

"They may have to look to customers in countries where the markets are less interventionist like Britain."

The latest rises mean that the average dual fuel bill for EDF customers in England will leapfrog that of families in France, rising from £1,005 to £1,211 here, compared with £1,013 to £1,061 for EDF and GDF Suez clients across the Channel, according to The Times.

EDF denied there would be cross-subsidising, insisting that EDF in Britain and France were separate entities and both were profitable. The law in France limits energy price rises to inflation.