Britain’s energy firms are being urged to pass on savings to hard-pressed homeowners and businesses, following a fall in wholesale oil prices of almost 30% in the last year.

Chancellor George Osborne raised the issue to the Cabinet on 7 January, warning energy firms, airlines and other travel providers that they must pass on oil price savings to end users or face intervention by Whitehall.

He has ordered an investigation into whether key sectors are passing on savings, and told utility firms that he will be “watching them like a hawk” to ensure they do the right thing and share the benefits with end users. Sanctions will be considered if energy providers fail to take action, he said.

Independent heating installer Swale Heating agues that cutting domestic energy prices will have a positive ‘double whammy’ impact on householders, many of whom are struggling to make ends meet as wages continue to lag behind the cost of living.

“Not only will families spend less on gas and electricity, but they will also have more money in their pockets to invest in products like energy-efficient boilers, new windows and better insulation which will then help to slash their future heating bills. It would be a win-win situation for all,” said Swale Heating sales director Matthew Edwards.

He agrees that government is right to put energy firms, airlines and others under pressure.

“Falling oil prices can provide a major boost to much of the UK’s economy and also domestic users of gas and electricity, provided these savings are passed on and not hoarded,” said Mr Edwards. “The ‘Big Six’ energy firms claim they buy their supplies years in advance so cannot just reduce their prices to consumers, but that excuse is wearing very thin now.

“On behalf of our hundreds of thousands of customers across the UK I would urge utility firms to do the right thing by their customers and cut their prices as quickly as possible.”