Energy regulator Ofgem has proposed a series of reforms to further improve standards of customer service for businesses.
Following extensive engagement with energy suppliers, businesses, consumers and other organisations, Ofgem has announced:
A Non-Domestic Market Review findings and consultation: The review summarises the challenges businesses face and proposes a number of actions for the sector, Ofgem, and government to address.
Minimum Capital Requirements for supplier finances: Ofgem has decided on the level of capital that suppliers are required to hold to ensure they are more resilient to severe but plausible market shocks.
For the non-domestic market, some of the immediate changes Ofgem has taken to help the non-domestic energy market include working with industry to adapt the Retail Energy Code to avoid excessive delays and unreasonable requests for documentation during tenancy changes and urging suppliers to be more flexible with businesses who signed up for peak fixed rate prices.
There are issues flagged in the review that require regulatory change, so Ofgem will consult on:
Introducing better complaint handling between suppliers and businesses.
Extending micro business protections to all businesses so energy bills spell out what is being paid to energy brokers plus allowing businesses to resolve disputes through a redress scheme.
Creating better guidance over ‘deemed contract rates’ between customers who have not yet agreed contractual terms with a supplier to avoid problems like overcharging.
Ofgem’s is asking the government to consider further protections in areas it doesn’t have the power to regulate, like energy brokers. Ofgem is also asking for businesses to be given access to the energy ombudsman.
Neil Lawrence, Director at Ofgem, said: “The plans we are announcing put the welfare of business and domestic consumers first and set out a comprehensive package to tackle poor behaviour by energy suppliers.”
In response, ACS chief executive James Lowman, said: “We welcome Ofgem’s acknowledgement that the protections afforded to microbusiness customers should be expanded to include more businesses, and support proposals to regulate the TPI market, but this is long overdue. Ofgem have been looking at stronger enforcement against rogue TPIs and wider business protections for a decade, and to date very little progress has been made. We need immediate action to ensure that the energy market is working competitively and fairly for everyone.
“We are pleased that the plight of businesses who signed contracts at the peak of the energy contracts has been acknowledged, but those businesses need more support now. Government help was cut back too far, too soon, and the energy companies are not doing enough to help through moving to blend and extend contracts or offering early exit from agreements.”
The NFRN’s National President ,Muntazir Dipoti, added: “Independent convenience retailers are the fabric of society and play a critical role in their communities, but with the cost of doing business soaring, many Fed members are struggling to stay in business.
“Businesses who signed contracts at the peak of the energy prices need more support now. Government help was cut too soon to help these businesses and the energy companies are not doing enough to help through moving to blend and extend contracts or offering early exit from agreements.”
