Britain’s power regulator has launched a six-week consultation seeking business users’ views on services delivered by third-party energy brokers, including fees charged.
Also under scrutiny are complaints handling offered to small firms by all non-domestic suppliers.
Business groups have repeatedly told Ofgem that they need more support with energy issues. Its probe of intermediaries follows engagement with energy suppliers, companies and other groups, who highlighted issues around disclosure and contract handling.
Tim Jarvis, the regulator’s director of markets, observed: “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.
“Our proposals will ensure better deals, better protection and more clarity for businesses – so they have the best chance of thriving at this difficult time,” Jarvis added
“The consultation kick starts the process to bring in a new set of rules for suppliers to make sure they improve customer service and clearly set out costs for customers, including costs customers pay for third party services, like energy brokers.
All customers should expect fair treatment from their suppliers and these proposals would tighten the rules to make sure that happens”.
Ofgem is also seeking views on expanding suppliers’ processes on complaint handling, including advice given to support services. Officials at the watchdog are enacting government wishes to that give firms with fewer than 50 employees should be able to escalate complaints about suppliers to the independent Energy Ombudsman. Currently only micro businesses can take disputes to the adjudicator.
The consultation includes proposals to:
- Expand existing rules on standards of conduct to all businesses. At present these apply only to interactions with microbusinesses. This change will make clear that suppliers should put customers first and would also allow Ofgem to take action if an energy supplier does not behave well towards any customer, regardless of business size.
- Expand rules around transparency on what consumers are paying for Third Party services to all business consumers. Many non-domestic consumers use Third Party Intermediaries (TPIs) such as energy brokers to help find the best deal for the business – and many good energy brokers often play a valuable and vital role in helping businesses navigate the energy market with confidence.
- However, the regulator believes all customers should be clear on the costs of these services and the costs of their supply contract, so Ofgem is proposing to extend the requirement for energy companies to separately show the costs of using a broker to all businesses, not just micro-businesses.
The watchdog is inviting companies’ responses before 31 January. Have your say here.