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Tougher rules on fixed term energy deals come into force as Ofgem’s retail market reforms begin to bite
Fixed means fixed – consumers on fixed deals now get price certainty
Automatic roll-overs now banned for householders on fixed deals
Energy suppliers are now subject to Ofgem’s reforms and the next step will see simpler tariffs coming into force at the end of December
From today new Ofgem rules come into force meaning energy suppliers are banned from increasing prices on fixed term tariffs.* They are also banned from automatically rolling householders on to another fixed term offer when their current one ends. These new rules are the latest stage of Ofgem’s reforms to reset the energy market so that it is simpler, clearer and fairer for consumers. They are in addition to reforms, introduced in August that require suppliers to treat consumers fairly, and are part of Ofgem’s work to make a positive difference for consumers.
Ofgem’s review found that with many fixed-term deals suppliers could still increase prices where they were index linked, for example, to standard tariff prices. This would tie consumers into a tariff they could not get out of even if prices went up. Ofgem also found that consumers were being automatically rolled onto new fixed term offers which could include termination fees, meaning they missed out on chances to compare the market.
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