The energy regulator, Ofgem, has banned energy companies from using confusing and complex tariffs. The new rules came into effect on 2 January 2014 and should make it easier for consumers to compare suppliers and choose the best deal. A second wave of rule changes is due to come into effect on 1 April 2014.
Changes already in place include:
- Customers now receive a maximum of four tariffs for each type of energy from each supplier
- Tariffs must be in a single unit rate
- All suppliers must publish information on what they have done and what is planned.
From 1 April 2014:
- Energy companies will have to publish annual statements detailing the steps they are taking to treat customers fairly
- New comparison tools including tariff comparisons, personal projections and tariff information labels will come into force
- Suppliers will have to regularly tell customers which of their tariffs is the cheapest.
Richard Lloyd, executive director at Which?, welcomed the move but said more was needed:
“Ofgem’s energy market reforms are a welcome step in the right direction but they just do not go far enough to boost competition and help consumers find the cheapest deals at a time when millions are struggling with the cost of living.
“This is why the Government should intervene with more radical measures including simpler pricing, greater transparency and scrutiny of the cost of energy policies, and the separation of supply from generation businesses. More must be done to keep prices in check and give consumers confidence that the price they pay for their energy is fair.”