A LABOUR government will cap energy prices if it wins power.

The commitment was given by shadow Chancellor John McDonnell, pledging legislation to limit future price hikes by the energy companies after one of the so-called Big Six announced it was putting up charges by almost 10 per cent.

Npower has come under fire from the UK Government and the energy regulator after setting out proposals to increase the average household bill expected to increase by £109. With other providers expected to follow with similar increases, McDonnell said a future Labour government would bring in statutory price controls.

"We would control them. We would legislate to control them. We can't allow this to keep going on," he told the BBC.

"You would introduce legislation in Parliament. You would limit the amount they can increase their prices by."

Npower said the rise – which comes in the face of rising wholesale costs – had been a "hugely difficult decision".

However, it was rebuked by regulator Ofgem, which said it did not see "any case" for significant price increases where suppliers have bought energy in advance.

McDonnell said Labour would seek to encourage more local suppliers as had happened in Germany.

"They used to have a Big Six companies. What they've done is they've invested at a local level where local communities are providing their own energy, largely renewable energy, and those profits have gone back into those communities," he said.

"In Germany now the big companies no longer control the energy supply. We have got to invest in the lifetime of the parliament to enable that to happen."

Npower's price hike on typical dual fuel annual energy bills is made up of an average increase of 4.8 per cent on gas and 15 per cent on electricity.

The firm said another 1.4 million fixed rate and pre-payment customers will not be affected by the increase.

However, the UK Government's Department for Business, Energy and Industrial Strategy said it was "concerned" about the planned price hike by the company.

"Suppliers are protected from recent fluctuations in the price of wholesale energy, which they buy up to two years in advance, and prices remain significantly lower than in 2014," a spokesman said.

"We expect energy companies to treat all their customers fairly and have been clear that, wherever markets are not working for consumers, we are prepared to act."

However, Lawrence Slade, chief executive of Energy UK representing suppliers, said increased switching by customers meant firms had to keep prices competitive.

"There are many components which make up an average energy bill – the majority of which are outside of suppliers' control and in some cases these are rising, putting pressure on bills," he said.