POWER industry regulator Ofgem said it would lift all price controls on gas and electricity suppliers as the market was now competitive enough.

It said competition had developed to such an extent that it was possible to lift price controls while still ensuring customers were protected and continued to receive real benefits.

The regulator said the majority of people were on tariffs which were not price controlled - more than 70 per cent of gas customers and half of electricity customers.

"We hope it will be better for the consumer and encourage a more competitive atmosphere and drive prices down," a spokesman said.

Ofgem chief executive Callum McCarthy said: "This decision heralds the future of regulation for these markets. As the markets have become more and more competitive, there has been less justification for price controls."