Publication date
Industry sector
Supply and Retail Market
On 16 February 2022, we set out our decision to temporarily introduce a Market Stabilisation Charge (MSC) as part of our decision on short-term interventions to address risks to consumers from market volatility. The MSC protects the interests of future and existing customers by reducing market instability and the resulting costs from supplier failures. It helps to incentivise domestic suppliers to better manage, on behalf of consumers, the risks posed by severe energy price volatility. We set out the initial parameters of the charge and published guidance on how it would be calculated. We confirmed that we would consult for at least two weeks if we proposed changes to the guidance.
We are now consulting on changes to the MSC parameters to make the charge more robust to ongoing and sustained levels of volatility observed in recent months. We are also consulting on technical changes to the MSC calculation methodology to reflect (a) updated guidance to domestic energy suppliers related to the price indexation methodology, and (b) electricity losses and unidentified gas.
We welcome views from all stakeholders with an interest in the domestic retail energy supply market. We particularly welcome responses from energy suppliers, consumer groups and charities.
Please send responses to this consultation on or before 14th April 2022 to: retailpolicyinterventions@ofgem.gov.uk or in writing to:
Retail Policy Interventions, Ofgem, 10 South Colonnade, Canary Wharf, London, E14 4PU.
We prefer to receive responses by e-mail.