Energy regulator Ofgem has called for more powers from the Government to tackle the mis-selling of energy.
It is seeking powers to take direct action against ‘rogue’ brokers that mis-sell energy to businesses, and are planning to review energy suppliers’ use of automatic rollover contracts.
The regulator is also developing a code of practice for brokers, which it hopes will give businesses greater confidence when using their services.
Philip Cullum, Consumer Partner, Ofgem, said:
“Small businesses are an engine of growth in our economy and it is crucial that they get a fair deal in the energy market. Many brokers play an important role in helping firms compare the market. However we want powers to take action against intermediaries that mis-sell, so businesses can have more confidence when using brokers.
“This move sits alongside other measures we have proposed, including enforceable standards of conduct for how suppliers should treat businesses and developing a Code of Practice for brokers. We are also scrutinising the use by suppliers of rollover contracts for businesses.”
Almost a third of businesses say that their energy contract has been rolled over at some point, and a result they could be stuck paying electricity prices that are 61% higher than the market rate for 12 months, according to our Business Energy Barometer survey.
Business Juice have both been calling for a total ban on rollover and for tighter regulation for some time and welcome this suggestion of action from Ofgem. However it must move on from the suggestion stage and become reality if the worst excesses of the business energy market are to be truly tackled.
To find out how you can protect yourself against rollover read our guide to rollover or visit our dedicated supplier pages to understand your supplier’s rollover and termination policy.