Ofgem proposes greater protection for business energy customers

The UK's energy regulator has launched a consultation on proposals to extend to more businesses rules about the service and transparency received when dealing with energy suppliers.

Ofgem said it has been "repeatedly told" by business groups that firms need more support with energy issues. As a result, it is proposing extending existing rules to more businesses.

Ofgem wants to expand standard of conduct rules which require suppliers to put customers first and allow the regulator to take action if an supplier does not behave well.

The rules currently only apply to micro-businesses which are defined as using less than 100,000 kWh of electricity a year, using less than 293,000 kWh of gas a year, or with fewer than 10 employees and an annual turnover total not exceeding €2m.

Ofgem also wants to expand rules around transparency on using third party energy brokers. This would extend the requirement for energy companies to separately show the costs of using a broker to all businesses, not just micro-businesses.

Finally, Ofgem is proposing to require suppliers to signpost small business customers to the support offered by Citizen's Advice and Advice Direct Scotland.

Alongside the Ofgem consultation, the government is proposing extending to all businesses with up to 50 employees the ability to take complaints about a supplier that they cannot resolve to the Energy Ombudsman. It claims the change will help an additional 200,000 firms.

Tim Jarvis, director of markets for Ofgem, said: 

"Businesses are no different from any energy customer and should be able to expect excellent service and fair prices. However, we have heard from too many businesses, particularly small and medium sized ones, that this isn't always the case. 

"Today's proposals will ensure better deals, better protection and more clarity for businesses - so they have the best chance of thriving at this difficult time."

The full Ofgem consultation details are here. You can respond by emailing NonDomesticRetailPolicy@ofgem.gov.uk by 31 January 2024.

Closure of Energy Bills Discount Scheme

The consultations come ahead of the planned ending of the government's energy support for businesses during the cost of living crisis.

The Energy Bills Relief Scheme, which provided a 50% discount on energy bills, closed on 31 March 2023 and was replaced by the Energy Bills Discount Scheme. That scheme, which provides significantly reduced support for most businesses, is due to end on 31 March 2024.

According to new Ofgem research, more than half of businesses (58%) are concerned about the impact of energy prices on their operations.

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