Ofgem is introducing new regulations

Ofgem orders energy companies to warn customers before price hikes

The energy watchdog is bringing in regulations to make energy firms give customers notice before they raise prices.

Previous rules allowed energy companies to write to customers up to 65 days after increasing prices, but Ofgem confirmed it was bringing in new regulations next month to give households more time to switch their provider before bill hikes.

The changes come as Ofgem leads a widespread shake-up of the industry. It announced a proposed overhaul last week, revealing it had gathered evidence proving that providers were raising bills more quickly than they lowered them when wholesale costs dropped.

Under the new rules, energy suppliers will also have to give customers 30 days’ notice of any change to their contract that will leave customers significantly worse off.

All the “big six” energy providers have brought in price hikes in recent months, blaming the rising cost of gas and oil on the wholesale markets.

Ofgem’s senior partner for markets Andrew Wright said the changes “will again show that we are serious about making sure suppliers play it straight with consumers”.

“We believe that 30 days’ advance notification of price increases, coupled with our new proposals for more transparency and an end to complex tariffs, will give consumers more power to make informed switching choices.”

The changes, which were first proposed by Ofgem in September, will come into force on April 28.

Ofgem last week threatened to refer energy companies to the Competition Commission if they do not simplify prices and sell off between 10 per cent and 20 per cent of their electricity output to allow smaller firms to enter the market.

Recent articles

Info Message

Our sites use cookies to support some functionality, and to collect anonymous user data.

Learn more about IET cookies and how to control them