Tim Jarvis speech to Utility Week Live 2026

Opening

When I took up the role of CEO at Ofgem a few weeks ago, as you might expect lots of people  came up to me to say congratulations and were really positive. 

But could not help noticing that nearly everyone followed that with a slightly nervous laugh and comment along the lines of ‘why on earth are you taking this on?’

It is fair to say there are some obvious challenges.

A war in the Middle East had just started, disrupting global energy supplies for the second time in a decade. 

We know how much the last one affected consumers and indeed affected Ofgem as an organisation.

And we were still waiting for a Review of Ofgem by the government which obviously creates a lot of uncertainty for us and staff, as we were coming, quite rightly, under scrutiny.

So I accept it is a challenging time to take over. But I also think it is an absolutely fascinating and exciting time to be part of the energy transition and in charge of the regulator during this period.

Not just because of the challenges we face but the opportunities.

We all know that electricity has long underpinned the wider economy – we are now seeing its role expand massively in sectors like heat, transport and heavy industry.

And stepping aside from the debate around Net Zero, electrification is happening across all major economies, and it is very much going to happen here too. Growth in demand for electricity seems a given: how much and when it is going to arrive is the really difficult thing to predict, and we need to make sure in preparing for that we do not dampen the growth in demand we are looking to create.

The potential is massive in terms of what it can deliver for the economy and the relationship between energy and major changes to the economy is clearly not a new one.

That is why coming to Birmingham is such an appropriate place to have this discussion.

It is about 250 years ago that Matthew Boulton built his Soho foundry in Birmingham: it was one of the most advanced industrial enterprises of its time.

But it only really took off when he partnered with James Watt, replacing water with steam power, and energy became the driver of that hugely transformative change in the economy.

Electrification, growth and the investment challenge

That is where we are heading. That electrification and that opportunity to be a part of it is a really exciting thing because it is such a critical input into growth, productivity and competitiveness in the economy.

And building prosperity in the economy requires sustained productivity from growth and I think energy regulation can play a huge part in that.

Some of you may know I spent two years of my career in the Treasury and we were constantly grappling with the productivity challenge in the UK economy, and while we were struggling to see that increase in productivity we need to help the economy grow, I think electrification of the economy has a huge potential to play in that. And we have a hugely important role in supporting it.

And I broadly see three parts to that.

The first is ensuring that sufficient energy is available reliably to businesses that need it. That’s a simple thing to say but a difficult thing to deliver when you are trying to anticipate that demand.

Secondly, recognising that the cost of energy is an important factor in our competitiveness, and we at Ofgem need to ensure that we are playing our part in that, in maximise the efficiency of the energy system while that meeting the demand to come.

And thirdly, we need to set the right frameworks and incentivise the sector to step up: to back investment and innovation in energy markets to support the changes in the way we power our transport, industry, and heat our homes. 

We want to see the energy transition create skilled, productive jobs that genuinely add value. But as an economic regulator, we also have to be alert to activity that inflates costs without improving outcomes – and that’s the balance I think we need to strike.

Responding to challenge: the Ofgem Review

That takes me on to the Ofgem Review, which I mentioned at the beginning as the big thing that has come our way since I started this role. And the emphasis that that places on growth and our role in it.

Obviously we are here to protect consumers. But it has also been the case for a while that we are also here to support net zero under the legislation from Parliament, and enable economic growth. That is a balance we need to strike.

Often, those duties reinforce each other. A cleaner, more resilient system can support growth and deliver better outcomes for consumers.

But we are not naïve – there are also going to be moments when there are real trade-offs, and we need to be clear about how those choices are made.

That is very much why I welcome the Review and what it says about this because it provides that clarity. It puts consumer protection, net zero and growth on a clear footing. But importantly it confirms the role that government can play in providing strategic direction and guide how those trade-offs are balanced.  That is a positive shift: clearer roles for everyone in the sector, and a stronger basis for predictable decisions which are needed.

We have also heard the challenge to us as part of this review process. And we have heard the criticism from different sides and possibly some of the people in this room. As the recent House of Lords report noted, regulation enables investment when it is faster, clearer and more predictable, and when it doesn’t it, when it is slow and overly complex, it hampers growth. We have heard that message clearly, and we will act on it.

Our job is to operate consistently and transparently within that framework: acting earlier where risks emerge, and reducing unnecessary burden, and building a system that is fair and earns trust.

Networks – enabling growth while protecting consumers

So let me start with some of the things we need to do in that context – perhaps starting with the networks.

Electricity network investment as many of you will know is set to increase significantly in capacity. And there is an incredibly strong case for that to meet growing demand, reduce the need for the energy system operator to pay balancing costs, where the cheapest available generation cannot travel to where it is needed.

We know that as a result of decision in electricity transmission alone, expenditure could reach around £70 billion over five years, reflecting the scale of that transformation. 

It is important to note that that is a significant quantum of investment, but the requests were higher still.

Our job as regulator is to strike the right balance: enabling that investment the system genuinely needs, at the pace required, while recognising that ultimately it is consumers that have to pay for it. And we work alongside others across the system to bear down hard on costs, avoid unnecessary or premature build and maximise the efficiency of the networks we have.

That is why we expect networks to improve productivity over time and deliver better value for money for households and businesses that pay for those upgrades.

And it is why in light of the current CMA appeals, I make no apologies for seeking to push monopoly networks to improve their productivity over time.

But one of the strengths of our energy system has long been the internationally recognised predictability of our regulatory framework. That has underpinned investment and kept financing costs relatively low that is so important to drive down the costs of consumers. And that is going to matter even more as we electrify.

But that does not mean we can’t be agile as well. And we have shown that through the Accelerated Strategic Transmission Investment programme - ASTI - which allows companies to move earlier, secure supply chains sooner, and get critical projects underway.

That is critically important in a world where other major economies are trying to electrify and transform their networks at the same time – so we can get ahead of that. 

Those projects are the backbone of the system we are building.

A good example of that is the Eastern Green Link, a high‑capacity connection designed to move renewable power across the country. Those projects are going to be exactly the ones we require if we are to meet the government’s ambition to connect up to 50 gigawatts of offshore wind by 2030.

But building that transmission network is only part of the picture.

Connections have become a major constraint. The queue had grown to over 700 gigawatts, far beyond what the system needs, so we’ve worked with NESO, the energy system operator, to remove around 220 gigawatts of non‑viable projects and create a more credible, deliverable pipeline.

And we should not underestimate the challenges of doing that. It is important that we make sure we get that queue in the right place.

And that brings us further down the networks to distribution. And we will be publishing our strategic decision tomorrow on this – our guidance.

If we are building out this major transmission network, the local networks have to be able to connect into it and carry that power through to homes and businesses. If we don’t invest there as well, we are simply going to create a bottleneck further down the system.

That’s why ED3 matters.

Demand from electric vehicles, heat pumps and other low‑carbon technologies is rising, but that is where there is significant uncertainty. Clearly the answer is not to build everything, everywhere, all at once.

We need to move to a more targeted approach: investing and building where the need is clear, and making much better use of flexibility and smarter solutions where it is not, so consumers only pay for what is necessary.

In practice, that means:

• connecting new demand quickly
• planning ahead where growth is clear
• and balancing build with flexible solutions so we avoid unnecessary or premature investment landing on bills

Digitalisation as core infrastructure

And that brings me to digitalisation. As important as building the infrastructure we need, better data and stronger digital capability and incentives that benefit the whole system.

Digitalisation is now core energy infrastructure: enabling flexibility at scale, supporting better planning and connections, and helping us make better use of the assets we already have. That matters because that is what drives down costs.

Better visibility of what is connected to the system, and how it behaves and facilitating markets that drive the most efficient allocation of resources. At the moment I don’t think we are making full use of the flexibility that is available and that exists and particularly for consumers.

From smart tariffs to home batteries and electric vehicles, more people can now adjust how and when they use energy. And I think we are seeing in response to the current crisis and the rise in the price of gas that more and more people are starting to think about this and prices are starting to come down.

The opportunity now is to unlock that at scale, making it easier for consumer‑led flexibility to participate in the system and help bring costs down.

I also recognise that that digitalisation and data journey applies to us as a regulator.

And one of our key commitments following the Ofgem Review, digitalisation and data will be a key priority for us, so we can regulate in a more targeted, more anticipatory way, and support a more productive system overall.

Markets – from prescription to outcomes

We are also changing how we regulate.

We have signalled our move towards more outcomes‑based regulation, particularly in the retail sector. It is a practical way of delivering greater pace, clearer predictability and more proportionate regulation.

We need to reduce the unnecessary administrative burden: fewer box‑ticking processes, clearer requirements, and faster decisions.

That starts with being clearer about what consumers actually experience. And I should note here that we have seen a massive change that largely gets unreported.

We now see levels of customer satisfaction in retail far higher than they were – at 81%.

That reflects the investment suppliers have made in their systems and people.

But expectations are changing and we can’t be complacent. Customers care about accurate bills, clear information, and fast, effective support when things go wrong. And increasingly they want affordable access to local carbon technology and clarity on what that means for their bills.

And for many that transition is no longer abstract. It’s already happening and it is going to become more and more prevalent. 

So we set out last year when I was in my old role at Ofgem we are changing how we regulate in this changing world, giving companies more space to innovate, allowing us to be clearer and more targeted in how we hold them to account.

We also recognise we need to provide a clearer line of sight on costs. Whether that’s network costs that we control or policy costs that government control, so there is greater predictability for both suppliers and consumers. And that predictable regulatory regime enables investment.

And we need to create the conditions for the sector to innovate, work together, and unlock consumer led flexibility.

And we are starting to see some great examples of that. I recently visited a project E.ON are running with one of the network operators, combining home batteries and time‑of‑use tariffs. The customer does not need to do anything but they are getting lower bills and we are reducing costs in the system in the constrained part of the network.

That is exactly the kind of outcome we want to enable, where innovation, infrastructure and consumer benefit come together.

Debt – a growing crisis

Probably the biggest challenge that we face to investability, to investing in these markets and supporting retailers in this is the rise in debt – and household debt in particular.

Our latest published data shows that domestic consumer energy debt had reached over £4.5 billion – that’s 20% than it was in 2024, and 71% since 2023.

Around three quarters of that debt is more than 91 days overdue and the customer is not part of a repayment plan.

Now much of that debt accrued during the extended cost of living crisis. And most people in debt are not there out of choice – the affordability pressures are very real and have been.

But high levels of debt also affect all energy consumers.

Direct debit customers are paying around £50 a year towards the cost of managing and writing off energy debt. Customers on Standard Credit pay significantly more. 

Millions of households who are paying their bills – often under significant pressure themselves – and are making difficult decisions about what to pay - expect the system to be fair are paying for them as well and resent paying for the cost of this debt.

Resetting the social contract

I think that the way we tackle debt has to change.

We need to strike the right balance, to ensure those that can pay are incentivised to do so, and don’t unreasonably contribute to debt costs borne by other billpayers.

Evidence shows that many customers with energy arrears are more up to date with payment to other utilities and bills. So it is the energy bill that is not being prioritised.

Energy cannot become a source of free or cheap credit by default.

We need to open the discussion about resetting the social contract on energy debt.

And that means responsibilities on all sides.

It means suppliers must bill accurately and on time, intervening early with customers who are at risk – if they are falling behind before it gets out of hand, and offering sustainable and affordable repayment routes. That is a key measure on which suppliers must be able to compete. I want to make sure that those who are good at that do better than those who are not.

It also means consumers should pay when they can.

And for us as a regulator, it means enabling responsible debt recovery alongside protections for those who genuinely need support the most.

But decisions about who should be protected and insulated from high energy prices are not ones the regulator and suppliers can make - it means government must be clear about the policy choices it wants to make about what support is available and which billpayers should pay to protect those who need protection.

A more sustainable approach to debt

We’re moving quickly to fulfil our part of the bargain.

We’re ready to progress the Debt Relief Scheme – we are looking to write off up to £400 million of debt accumulated during the last energy crisis.

And as part of that deal we are looking to engage customers who receive it to engage with their supplier and get on payment plans to limit the build-up of new debt.

We’re also acting to make sure burdensome regulation doesn’t prevent suppliers from recovering debt where that’s appropriate. We are focusing on the house moving process where around a third of debt builds up. We are pretty much unique in Europe in providing almost unlimited free credit when people move into a property for their energy. And I think this is something we need to look at - this is not good for anybody.

We will consult over the summer about changes to guidance, and we are already talking to suppliers about what they can do under our current rules.

We also want to look at how best we can encourage sound payment practices through pay-as-you-go, support modern payment methods, and how to optimise smart meter technology to support customers earlier and better.

And there are areas where we need government to help us to make more progress.

Data sharing will help to target support more effectively to those that need it.

Legislative changes could scale what we are able to do in the home moves process. We should give landlords the same responsibilities similar to those they have in the water sector – to tell their energy supplier when people have moved out and who is moving in.

And of course it’s for government to consider the broader framework of what affordability interventions that they may want to make.

We will continue to work with government in these areas. Getting on top of the debt challenge needs concerted and coordinated action from us as regulator, suppliers, government and the third sector to ensure we fairly balance rights and responsibilities.

How we will regulate differently

Tackling all of this requires us to operate differently – I think we recognise that at Ofgem and I would sum up our ambition in this phrase in four behaviours you should expect from in the way we regulate the sector in the coming months and years.

Predictable, Agile, Collaborative, and Technology‑enabled. The smarter of you will have recognise that that spells PACT – our pact with sector and with consumers.

Predictable means you should understand the rules you are operating under, and the direction Ofgem is taking in good time.

Agile means we will engage earlier where risks are emerging and respond proactively and at pace.

Collaborative means clearer standards, firm when performance falls short, and we have highlighted our ability to do that recently, but more open working with industry, consumer groups and government to get outcomes right.

Technology-enabled means using data better to improve visibility, share information more easily, and support more effective, lighter touch regulation. 

Conclusion

Let me end on a more personal note.

My instinct will always be to protect consumers – especially those who are most vulnerable – it is where I started my career. Energy is not a nice to have; it is an essential service and that gives us as regulator and those who supply it particular responsibilities.

But I also believe something else very strongly: that the best way to protect consumers in the long run is to help build a sector that thrives: one that innovates, attracts investment, serves its customers well, stays competitive as technology evolves, and keeps improving.

That is where we have to work together.

We need to improve how we regulate, reduce unnecessary burden, and work with you in a way that is clearer, faster and more constructive.

And in return, I am asking the sector to go further – to go over and above in serving consumers, because in a more volatile and uncertain world, that higher standard is what people expect and need. 

As I said at the beginning, that is a massive opportunity as well as a challenge, and I really look forward to working with all of you to get that right together.

Thank you.