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Energy consultation responses

Response to Ofgem consultation on changes to the Market Stabilisation Charge

14 April 2022

Ofgem was consulting on changes to the Market Stabilisation Charge (‘MSC’). The MSC is designed to compensate suppliers if they lose customers following large falls in wholesale prices. That compensation would effectively be paid by consumers, and reflected in higher bills. Ofgem was proposing to make these charges larger. We opposed this proposal.

Response to Ofgem consultation on medium term changes to the price cap methodology

04 March 2022

Ofgem was consulting on medium term changes to the energy price cap that are intended to reduce the risk of supplier failure. We expressed support for the option of moving to a quarterly price cap. We argued that an alternative proposal of moving to fixed term 12 month default tariffs would increase risk compared to the status quo and should not be pursued.

Response to Ofgem's statutory consultation on potential short-term interventions to address risks to consumers from market volatility

17 January 2022

Ofgem was consulting on whether it should introduce short term measures to discourage switching, in order to reduce the risk that more energy suppliers go bust. We strongly opposed its suggestion that exit fees should be introduced on default tariffs, but provided support for a proposal that suppliers should be required to offer all their new tariffs to existing customers.

Response to Ofgem's consultation on the Warm Home Discount (‘WHD’) scheme allowance methodology in the default tariff cap.

17 January 2022

Ofgem was consulting on how it should adjust the energy price cap to account for changes to the Warm Home Discount scheme that are still being finalised. We agreed with its proposal that it should use the government’s provisional cost estimates, and that it should subsequently make a correction if those estimates did not tally with the final costs. We argued it should give itself more flexibility than it is proposing on when any correction should take place however, in order to avoid putting further pressure on consumer bills when they are at record levels.