The Department for Energy Security and Net Zero (Desnz) said the changes mark the first major update to Ofgem's scope since the regulator was founded in 2000. The reforms aim to address market complexity and close consumer protection gaps, as the market has grown more complex with a wider range of products and services and growing numbers of customers in poorly regulated areas.
Under the reforms, Ofgem will gain direct enforcement of consumer law, avoiding lengthy court processes. Meanwhile, oversight of home upgrade schemes will move to a new Warm Homes Agency within government. Desnz noted that heating oil customers have seen prices spike during the conflict in the Middle East.
This Government is fighting people’s corner, and today we set out steps to strengthen protections for energy consumers. This includes tough and fair measures to ban energy company bonuses if they break the rules.
Energy Secretary Ed Miliband said: "This Government is fighting people's corner, and today we set out steps to strengthen protections for energy consumers. This includes tough and fair measures to ban energy company bonuses if they break the rules." Martin McCluskey, Minister for energy consumers, added that the government is "giving Ofgem stronger powers to fight consumers' corner." Interim Ofgem chief executive Tim Jarvis said the review sets out "ambitious, necessary reforms" to meet the challenges of an increasingly electrified and flexible energy system.
It remains unclear what specific licence conditions would trigger a bonus ban, when the reforms will come into effect, and how the Warm Homes Agency will be funded.
Every household must be given a fair deal, and today we transform our energy regulator to give families stronger protections. We’re giving Ofgem stronger powers to fight consumers’ corner, changing their remit so they can protect every consumer, and introducing new measures so they can hold energy executives to account. We’re making the market work for those who use it, working with the regulator to make sure customers are put first. We will continue to stand up for working people and fight their corner as we tackle the affordability crisis – our number one priority.
Great Britain’s energy system is going through the biggest changes in our lifetimes, and the regulator needs to be able to keep pace with that change. This review sets out ambitious, necessary reforms that will enable Ofgem to meet the challenges of regulating an increasingly electrified and flexible energy system and protect consumers so they can engage confidently in markets offering new products and services. We have delivered significant reforms in recent years, but this review enables us to make changes