Energy regulator Ofgem has announced plans to protect vulnerable consumers as part of a wider programme to make sure all consumers get a better energy deal.
Options being considered include introducing a safeguard tariff for vulnerable consumers which would protect them from overpaying for their energy. Research from Ofgem and the findings of the Competition and Markets Authority investigation point to vulnerable consumers in particular getting a poor deal. As we move towards a smarter, more competitive energy market, Ofgem is committed to ensuring that vulnerable consumers in society are not left behind.
For consumers more able to engage in the energy market, Ofgem is taking action to take the hassle out of switching. While the number of switches is at a nine year high, according to Ofgem’s latest data3, many people think it’s too much hassle and have never or rarely switched. This includes changing the rules for price comparison websites4 to make it easier for people to switch to cheaper deals, and trialling a new ‘Check Your Energy Deal’ online switching service5 to help customers who have been on poor value standard variable tariffs for three years or more to find cheaper deals.
Ofgem has also announced separate proposals8 to cap at £150 how much suppliers can charge customers for installing a pre-payment meter under warrant and to ban these charges altogether for the most vulnerable. Pre-payment meters are typically installed under warrant when a customer cannot or will not pay their energy bill.
Dermot Nolan, chief executive of Ofgem, said: “Protecting vulnerable consumers is a priority for Ofgem. We are committed to ensuring that the more disadvantaged in society are not left behind as we move towards a smarter, more competitive energy market. That’s why we are starting new work to protect vulnerable customers, including the option of introducing a safeguard tariff for them.
“Suppliers must also do more to get all their consumers, particularly those on poor value standard variable tariffs, a better deal. We are pressing ahead with a raft of reforms to make it even easier for people to switch no matter how they choose to shop around.”