One thing that we have learnt since Red Ed’s appointment is that sensible energy policy and the Labour party don’t make regular bedfellows, however the opposition may be turning a corner.
Labour has long promised a “new energy regulator”, we for one believe this cannot come soon enough given the utter disarray and disrepute that current regulator Ofgem finds itself in.
However Labour have now gone one step further, to not only create a new regulator but also an emboldened one with the power to directly revoke the licences of energy suppliers in cases where “serious and deliberate breaches of their licence conditions which harm the interests of consumers” are proven.
Currently Ofgem has the power to revoke licences in limited circumstances for failure to comply with enforcement orders, however regardless of the context the ‘slate’ is wiped as long as a fine is paid.
Shadow energy secretary Caroline Flint criticised the current regulator’s arrangement by saying:
“Too often [the energy suppliers] seem to view the regulator’s fines as a cost of doing business, not as a warning to get their act together”.
“The public has the right to be treated fairly by energy companies. Where firms fail to meet these standards, there must be tough and decisive action.”
From our own analysis since June 2010 the Big 6 energy suppliers have been fined a total of £60,875,000, in addition the energy sector is still facing 16 probes of its practices, clearly something isn’t working as a disincentive for poor customer experience.
Flint added:
“If energy companies persist in mistreating their customers they must know their licence could be on the line.”
Rather hopefully Ofgem said the announcement promised to boost its own powers and that it was “always interested to work with government on any new powers or refinements to existing powers that would help to protect consumers”.
Although one doesn’t expects Flint to be in a position of influence come the next parliament at least a modicum of sense is finally apparent from Her Majesty’s Opposition. A fit for purpose regulator, now that would be a refreshing change.