UK’s Ofgem proposes new rules to protect customers amid soaring energy prices

A view of Bournemouth beach as people and children enjoy the hot weather, as a heat wave reaches the country, in Bournemouth, Britain, June 17, 2022. REUTERS/Hannah McKay/File Photo

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June 20 (Reuters) – Britain’s energy market regulator Ofgem on Monday proposed new measures for energy suppliers to protect consumers’ money amid risk of supplier failure due to severe weather, a move that comes as households struggle to meet soaring energy bills.

The UK government earlier this month asked Britain’s energy network operators to implement new measures to handle severe weather events better after a review of the industry’s response to Storm Arwen in November 2021. read more

The proposed changes include tightening of direct debits that energy companies can charge its customers, a decision that will help to prevent the costs being picked up by consumers, it said.

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“Today’s proposals will make sure that customers’ hard-earned money is properly protected so that a company must foot the bill if it fails, rather than consumers picking up the tab,” Jonathan Brearley, chief executive of Ofgem, said in a statement.

The rules also include improvements to the financial health of energy suppliers to ensure the companies have a sufficient buffer to withstand severe weather conditions, Ofgem said.

Household energy bills in Britain look set to surge by another 40% in October, Ofgem warned last month, deepening a cost-of-living crisis that is piling pressure on the government to do more to help the poorest. read more

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Reporting by Nishit Jogi and Akriti Sharma in Bengaluru
Editing by Nick Zieminski

Our Standards: The Thomson Reuters Trust Principles.

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