Ofgem Press Release 21 November 2011 Extracts

Business To Get Better Protection Under New Ofgem Proposals

• New enforceable standards of conduct with financial penalties to improve supplier behaviour
• Stronger protections for small businesses
• Added protections for businesses using energy brokers
• Ofgem is actively considering enforcement action against suppliers who are not playing it straight with businesses who are trying to change supplier
  
  

Proposals :

• Putting new standards of conduct into suppliers’ licences so Ofgem has the powers to enforce them if they are breached. These aim to ensure that suppliers and the brokers that represent them are fair, honest and transparent in their dealings with businesses. Also, all sales and marketing to businesses will be required to be accurate, not misleading and written in plain English.
• Extending existing licence conditions which protect micro businesses* to benefit larger small businesses with less than 50 employees and an annual turnover of no more than €10 million. These prescriptive rules require suppliers to provide clear and transparent contract terms and conditions up front and regulate how contracts can be rolled over.
• Proposing a range of reforms to better protect businesses from unfair sales practices. In addition to the new standards of conduct, which cover marketing and all other dealings with business customers, these include an Ofgem accreditation scheme for Codes of Practice governing energy brokers; and asking government for new powers to take enforcement action directly against brokers for misleading marketing in the business sector. Ofgem currently has no direct powers to take enforcement action against energy brokers that only deal with business customers.
• Ofgem is currently reviewing whether suppliers are compliant with licence conditions which make sure suppliers cannot unjustly frustrate businesses switching to another energy provider. We are now actively considering enforcement action against some suppliers after our research in March found evidence of a high number of objections by companies that were preventing many businesses from switching.