Ofgem reforms could see customers get automatic compensation on energy bills
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Households will be offered more protections from energy providers under major plans to reform the energy regulator Ofgem. Under Labour's plans, the watchdog could get new consumer-facing powers, including shortening the eight-week mandatory response time when people complain to their energy supplier and establishing automatic compensation for customers when things go wrong with their energy bills.
The watchdog could get new consumer-facing powers, including shortening the eight-week mandatory response time when people complain to their energy supplier. The government hopes the move will help rebuild trust within the sector. Trust in providers—and the regulator—was essentially obliterated in 2022 when energy prices skyrocketed, causing a swathe of smaller suppliers to collapse.
Alongside this, larger energy firms were accused of profiteering from Russia's invasion of Ukraine, which caused wholesale gas prices to rise. In response, firms hiked energy bills spectacularly, claiming it was needed to help cover the increased costs, but then subsequently reported record-breaking profits. Energy consumers minister Miatta Fahnbulleh said the Government has "learned from the energy crisis" but noted that bills were still too high.
Fahnbulleh said: "We will ensure that working people have access to the best possible support to choose more affordable, smarter, clean energy that is right for them. Energy bills are still too high and that is why we worked with suppliers to announce £500million of additional winter support.".
