ACS (the Association of Convenience Stores) has welcomed an announcement from the Department for Energy Security and Net Zero that energy regulator Ofgem will be appointed to oversee the energy broker market.
Energy brokers, also known as third party intermediaries, typically act as comparison services for businesses. However, due to the unregulated nature of the market, not all brokers act in their customers’ best interests.
Several brokers have been found to recommend tariffs based on commission, misrepresent the commission they receive, and mis-sell contracts that are less beneficial than promised.
ACS has raised concerns about unfair practices from energy brokers for several years. In its Retail Market Review in 2012, Ofgem acknowledged issues in the broker market and proposed a code of practice for suppliers to work only with approved brokers. However, this was introduced as a voluntary code, and earlier this year Ofgem rejected calls to make it mandatory.
Association of Convenience Stores Chief Executive James Lowman said: “We have been calling on Ofgem and the Government to do more to protect convenience retailers from rogue brokers for over a decade, and we’re pleased that action is finally being taken to regulate this market.
“Energy brokers can provide an important service for retailers that saves them time and money, but not all brokers operate to the same standards. We look forward to continuing to work with Ofgem to ensure that these proposals benefit retailers and stop unfair practices in the energy market from rogue brokers.”
