Microbusiness Strategic Review: Policy Consultation

Publication date
29th July 2020
Closing date
23rd October 2020
Policy areas
Status

This policy consultation sets out our proposals to address a number of key harms faced by microbusinesses in the retail energy market as identified by our Microbusiness Strategic Review.

We are consulting on introducing each of the following measures as part of a package of reforms designed to improve microbusinesses experience of the market:

  • Broker conduct principle: Introducing  a principles-based requirement for suppliers to ensure brokers they work with conduct themselves appropriately
  • Broker dispute resolution: Introducing a requirement for suppliers to only work with brokers signed up to an alternative dispute resolution scheme
  • Informed contract choices: Applying targeted sales and marketing rules to suppliers and brokers they work with via supply licence changes
  • Broker commission transparency: Clarifying and strengthening existing supply licence obligations to provide information about broker commission payments on contracts, bills and account statements
  • Cooling-off period: Introducing a 14 day cooling-off period for microbusiness contracts
  • Contract extensions: Requiring suppliers to maintain existing contract rates for up to 30 days while issues with a blocked switch are being resolved
  • Banning notification requirements: Banning suppliers from requiring microbusinesses to provide notice of their intent to switch

In addition, we propose to work collaboratively with leading consumer groups to improve awareness raising materials and information provision.

We want to hear from anyone interested in this consultation. Please send your response to CDconsultations@ofgem.gov.uk, or via Survey Monkey, by close on 23 October 2020. Subject to responses we intend publishing a statutory consultation in winter 2020/21 and for changes to be implemented later in 2021.

Stakeholder Events

Thank you to those who attended and participated in our series of events covering our policy proposals as per our policy consultation. We intend to use the outcomes of these, along with information gathered from stakeholder bilaterals and formal consultation responses, to help inform our policy thinking ahead of our Statutory Consultation.

Further to Event 1, the Ombudsman Services are currently inviting energy brokers and suppliers to contact them about being involved in a pilot Alternative Dispute Resolution scheme. Further information on this is available on the Ombudsman Services website.

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