Supplier Licensing Review: reducing credit balance mutualisation

Consultation
  • Upcoming
  • Open
  • Closed (awaiting decision)
  • Closed (with decision)

Publication date

Closed date

Industry sector

Supply and Retail Market

Licence type

  • Electricity Supply Licence
  • Gas Supplier Licence

As part of the Supplier Licensing Review, we are consulting on proposals for prescriptive rules to reduce the scale of credit balances at risk of mutualisation in the event of supplier failure.

Credit balances primarily arise from fixed direct debit payment model, which can deliver significant consumer benefits, particularly in smoothing energy costs across the year. However, some suppliers may currently collect more credit than required to service their customers. We have defined these as surplus credit balances. Our proposals target these surplus balances, reducing the amount at risk of mutualisation, while allowing suppliers to continue to collect credit balances where these are required to help smooth customer payments evenly throughout the year.

Please send responses to this consultation on or before 12 May 2021 to: supplier@ofgem.gov.uk.

Respond name

Cameron Bailey and Jeremy Adams

Respond telephone

Respond email