Ofgem’s ban on complex energy tariffs comes into effect today. Claire Osborne, energy expert at Uswitch.com, says: “Ofgem is starting the year with a bang – making it clear to consumers that it intends to reignite competition in the energy market. It has made some great strides in simplifying what was a complex maze.
“However, in firing up an engine there is always a danger of a misfire. In the case of the energy market it’s vital that simplification doesn’t inadvertently result in higher prices, less choice and dampened innovation as this will harm rather than help consumers.
“Some consumers have already lost out as tariffs designed for certain groups, such as the elderly, have been pulled and valuable discounts have been lost because they don’t fit into Ofgem’s blueprint. The fact is that simple tariffs alone won’t encourage people to shop around – they need an incentive and this will typically be a better deal, better value for money or a better price. These elements must be nurtured, not stifled, if competition is to flourish.
“Ofgem has indicated that it intends to keep an eye on the impact of its reforms, plus the new competition test will hopefully pick up any early warnings that the reforms are not quite hitting the mark. The important thing is that Ofgem stays on its toes and reacts swiftly to any danger signs. With switching already at an all-time low, and prices at an all-time high, consumers cannot afford to wait any longer to get the competitive and innovative energy market they need and deserve.”
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Uswitch is the UK’s top comparison website for home services switching. Launched in September 2000, we help consumers save money on their gas, electricity, broadband, mobile, TV, and financial services products and get more of what matters to them. Last year we saved consumers over £373 million on their energy bills alone.
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