Better energy deal for UK consumers

The new procedures will include new powers for UK energy regulator Ofgem, help for prepayment meter customers in debt, better billing and an independent suppliers’ summit.

Ofgem will be able to order companies that have breached license conditions to compensate consumers who have lost out directly. Consumers will therefore benefit directly instead of the fines going to the Treasury.

The Government wants energy consumers to be able to choose the best energy tariff for them. At the moment prepayment meter customers, who are more than £200 in debt to their energy supplier, cannot switch to another company. This threshold will be raised to £500.

Energy Secretary Edward Davey has been pushing to make it easier for people to club together to get a better deal on their energy. ‘Collective Purchasing and Switching’ has the potential to help the most vulnerable households to save. The Secretary of State wants to see many more similar schemes introduced and is funding £5m competition for the most innovative local authority or third sector schemes.

The Government is working with Ofgem to ensure that consumers have clear information on their bills about the supplier’s cheapest tariff and the savings consumers could make by switching. The Government is also working with suppliers to get better information for consumers. It includes the possibility of putting Quick Response (QR) codes on energy bills/annual statements to make it possible to switch through mobile phones.

99% of domestic households are customers of only six main energy suppliers. The Government wants to see more competition in the market, with companies working harder to win and then keep consumers’ business. The Secretary of State will host a summit with independent suppliers in order to explore what more can be done.