Guernsey Electricity will have to reduce prices to within 11% of Jersey's.
Guernsey Electricity has to cut the difference between its own and Jersey Electricity's average tariffs by 6% over the next three years.
The department, sole shareholder of Guernsey Electricity and Guernsey Post, has established a Memoranda of Understanding (MoU), which aims to benchmark the companies' performance in strategy, pricing and customer satisfaction.
The MoU has been developed with both companies by Treasury's supervisory sub-committee.
Sub-committee member Deputy Roger Perrot said that even though electricity provision in Guernsey would always be higher than in Jersey, the price gap would be tackled.
'The sub-committee has set Guernsey Electricity a target to reduce the difference between its own and Jersey Electricity's average tariffs by 6% over the next three years.'
Guernsey Post's objectives include providing domestic postal services at externally benchmarked and competitive prices.
Treasury and Resources minister Deputy Gavin St Pier, pictured, said that while the commercial success of the companies was important, 'protecting the interests of consumers and ensuring the companies act in the best strategic interests of the Bailiwick of Guernsey' were key to the MoU.
