UK plans to give Ofgem power to fine energy brokers — The Guardian
In the United Kingdom, energy regulator Ofgem is set to receive new powers to counter the mis-selling of overpriced energy contracts to households and businesses. As The Guardian reports, the relevant provisions will be included in the Energy Independence Bill, which is due to be presented on Wednesday, November 4.
Ofgem will be able to demand compensation payments, impose fines and ban operators that have broken the rules and mis-sold excessively expensive contracts to businesses and households. The regulator will also receive powers to restrict payments to energy company executives if suppliers or brokers breach the requirements.
Regulation of brokers
Companies that enter into energy supply contracts often use brokers to find favourable terms. Unlike intermediaries in the mortgage or insurance markets, energy brokers are mostly unregulated.
According to the government, rogue brokers may have pushed small businesses into signing excessively expensive contracts and received hidden commissions. Energy brokers and price comparison services are expected to come under Ofgem's oversight. This is expected to help businesses save more than £100 million annually by tackling hidden commissions and the mis-selling of services.
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Energy Minister Miatta Fahnbulleh said that consumers should not suffer losses because of the actions of energy companies or have to fight for fair treatment when problems arise. According to her, executives who fail to meet their obligations to customers should not receive large bonuses at the expense of families and businesses.
Energy efficiency and fracking
The bill also provides for stronger powers for local authorities in relation to landlords who fail to comply with energy-efficiency standards. They will be able to receive fines of up to £30,000. Since 2020, it has been prohibited to rent out properties with an energy-efficiency rating below E unless the landlord can demonstrate entitlement to an exemption.
Separately, the government plans to introduce a moratorium on fracking, ending the granting of new licences for onshore activity in England. The restrictions will not apply to low-volume operations and so-called proppant squeeze. Tony Bosworth, a representative of Friends of the Earth, called this an attempt to leave a loophole for the industry, while the government said it had no evidence of similar risks from such operations compared with high-volume fracking.
