Ofgem to clamp down on rogue energy brokers

On the 23rd of July, Care England challenged Ofgem to take immediate action on hidden energy costs by co-signing a letter with eight leading business representative associations which was picked up in a Guardian article on the 23rd July and referenced again on the 25th July relating to disclosure of broker fee transparency on unfair gas and electricity deals.

Ofgem released its statement on the 26th July after its non-domestic market review conducted earlier this year, stating how it attempts to tackle the concerns raised by the association representatives in a letter coordinated by Box Power CiC.

Ofgem will take immediate action to help non-domestic consumers by adapting the Retain 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 and also published today a Best Practise Guide for energy suppliers in relation to Security Deposits.

Ofgem will also consult on:

• Introducing better complaint handling between suppliers and businesses – the review heard businesses did not always get the right level of customer service.
• 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.

As Ofgem’s powers for the non-domestic market are more limited, it is asking government to consider further protections to regulate energy brokers and to allow businesses to access the energy ombudsman and for consideration for vulnerable consumers like those living in care homes who are missing out on protections.

Professor Martin Green, Chief Executive of Care England, said: “Over the last 16 months, Government support has not reprimanded the inflated energy costs, which remain unsustainably higher than in previous years, and often worsened by poor broker behaviour.  The care sector has been disproportionally affected by the rising energy costs, and the announcement today is a welcome step forward. Care England has been exercised in its calls for business protection measures and is pleased that the needs of the care sector have been recognised, only this week seeing a broker charge £68,126 for an energy renewal which our own professional energy broker reduced to £12,606. Consulting on extending micro business protections to all businesses is therefore essential to draw a halt to rogue broker behaviour and we welcome the increased protections Ofgem has called on government to consider, including the power to regulate brokers and support vulnerable consumers on non-domestic contracts in care homes.”

Earlier this year, to combat unscrupulous broker behaviour Care England launched the second round of its energy tender which remains open to all care providers, to secure the lowest possible energy prices for gas and electricity renewals between 2023 and 2026. Those wishing to take part can register here.