Ofgem has unveiled today plans to protect the UK’s smallest businesses from ‘unscrupulous’ energy brokers.
The energy regulator’s proposals include obliging suppliers to only work with brokers who have signed up to an alternative dispute resolution scheme and follow a framework of requirements.
The new rules aim to allow microbusinesses to switch to another supplier more smoothly, without having to waste money and time.
For this reason, Ofgem introduces a 14 day cooling-off period for microbusiness contracts.
Figures show that two out of three small businesses, use an energy broker when choosing an energy contract and in many cases face a lack of transparency, ending up with poor value deals.
The announcement comes after Ofgem has found a small number of microbusinesses are paying thousands more than they needed to in broker commission charges.
Philippa Pickford, Ofgem’s Director of Future Retail Markets, Consumers & Markets said: “Providing greater transparency and tackling unscrupulous brokers will help microbusinesses get a better, fairer energy deal. This is more important than ever as microbusinesses emerge from the challenges posed by the Covid-19 pandemic.
“These proposals are part of Ofgem’s wider work to improve the energy retail market through smart metering, extra support for vulnerable customers, plus faster and more reliable switching”.
ELN has relaunched TELCA this year and will be creating a report of industry trends and attitudes, in particular around trust and transparency.
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