Government's £1,000 pledge to help insulate homes

Downing Street sources indicated the grants would be available for purchases of new-build or older housing stock, with the amount depending on the property's energy efficiency and how much work needs to be done.

Chancellor George Osborne is due to give full details of the deal struck with the 'Big Six' energy companies in his Autumn Statement on Thursday.

The intervention by Mr Cameron and Mr Clegg marks a concerted effort to regain the initiative on the energy issue, which has dominated the political agenda since Ed Miliband promised to freeze prices for 20 months if he wins the general election.

The coalition leaders accused Mr Miliband of "taking people for fools".

"Energy companies would hike up prices both before and after the freeze - so families would end up paying more," they wrote.

"Not only that - by cutting investment in green energy, their freeze would threaten thousands of jobs.

"Labour's con is the worst of all worlds. When an offer sounds too good to be true it usually is."

They insisted the Government was putting forward "a serious and credible plan that actually works".

EDF said its "decision to hold back the full impact of rising costs" earlier this month by implementing a lower rise than competitors had been "validated by tonight's confirmation that the Government will take action on energy charges".

"EDF Energy was the only major energy company to lessen the impact of higher charges in advance because it was confident that action could be taken to reduce costs," it said in a statement.

"Following this news, EDF Energy expects to be able to maintain its lower price rise of 3.9%, as anticipated. That decision left customers with bills £80-96 lower than major competitors who had announced price increases.

"The company looks forward to hearing more detail from the Government, but does not anticipate that EDF Energy's prices will rise again in 2014.

"Customers should expect other energy suppliers to follow EDF Energy's lead by significantly lowering their prices."

However, shadow chancellor Ed Balls accused the Government of "half measures and panicky climbdowns".

"After last year's Budget, Chancellor George Osborne was forced into chaotic U-turns on the pasty tax, the caravan tax and the charities tax," he wrote in the Sunday Mirror.

"This time the U-turns have started before he's even made his speech.

"With four days until the Autumn Statement, we've already had panicky changes in Government policy: on payday loans, cigarette packaging, energy subsidies and bank lending...

"On energy, the test for George Osborne is this: whatever he announces must both stop bills rising this winter and make the energy companies pay for it, not the taxpayer.

"We don't need more half-measures and panicky climbdowns from the Omnishambles Chancellor. Only a price freeze will do."

Shadow energy secretary Caroline Flint said: "Energy bills are going up by £120 this winter alone, so the Government are dealing with less than half this year's increase, never mind the £300 that bills have gone up by since they got into power.

"It's no surprise with this Government that they're not asking the energy companies to pay for it. David Cameron always stands up for a privileged few. This shows why only a price freeze will do.

"Labour's price freeze would save money for 27 million households and 2.4 million businesses and our plans to reset the energy market would stop these companies from overcharging people in the future."