Ofgem’s energy plans ‘won’t protect disengaged customers’

Ofgem’s plans to adopt the competition watchdog’s proposals “don’t go far enough” for energy customers.

That’s the view of the head of First Utility, who believes the proposals “put too much onus on the customer”.

Managing Director Ed Kamm’s comments come as the regulator outlined its approach to the recommendations of the Competition and Markets Authority (CMA) following a two-year investigation.

Protecting prepayment customers and encouraging more switching are part of Ofgem’s plans.

Mr Kamm said: “The CMA’s report rightly identified the problem – too many people, some 70% of UK households, are overpaying for their energy.

“But the proposals put too much onus on the customer, don’t go far enough and the timing of their implementation is baffling. Ofgem itself admits that consumers who are already engaged in the market will see the first benefits.

“We are in real danger of continuing to fuel a ‘tale of two markets’ – helping those who already shop around and doing little to properly help those who are continuing to pay much more than they need to or should.”

Independent energy supplier Good Energy however believes Ofgem’s move is a good thing as the Big Six “have taken loyal customers for granted for far too long”.

CEO Juliet Davenport said: “Consumers deserve a fair and transparent market so they can have confidence in their energy suppliers and energy companies deserve a level playing field which supports and encourages competition. Smaller suppliers are taking more customers than ever before as consumers look for better service, fairer prices, company ethics and local and green energy.”

Big Six supplier EDF Energy is calling for “swift implementation” of the CMA’s remedies.

It added: “Ofgem has an integral role to play in delivering the remedies package, especially in providing clear, reliable and trustworthy information about the energy industry. We want to see a strong, independent, respected regulator trusted by customers and companies alike. We therefore strongly support the improvements to the regulatory framework that the CMA has confirmed.”

Consumer body Which? believes the regulator faces a huge challenge in implementing all the recommendations “in a way that stimulates competition to deliver better outcomes for many more consumers”.

Director of Policy and Campaigns Alex Neill said: “For this to happen the industry will need to commit to working with the regulator to ensure people get a fairer deal on their energy.”