Energy watchdog is urged to fine firms accused of profiting by hiking bills even further
- The price cap leapt by 54 per cent for gas and electricity at start of this month
- But it is claimed some energy firms have pushed up direct debits by even more
- Kwasi Kwarteng told Ofgem to issue ‘substantial fines’ to enforce compliance
Ministers have demanded a crackdown on rogue energy firms amid claims some are hiking bills by more than is justified.
The price cap leapt by 54 per cent for gas and electricity at the start of this month, but it is claimed some firms have pushed up direct debits by even more.
This allows them to potentially amass millions of pounds in customer credit balances to subsidise their businesses.
There are also suggestions that some companies put pressure on customers to move to long-term deals that are more expensive than the official price cap.
Business Secretary Kwasi Kwarteng has written to the head of energy regulator Ofgem calling on it to issue ‘substantial fines’ to enforce compliance.
Ofgem has already launched a series of probes.
The price cap leapt by 54 per cent for gas and electricity at the start of this month, but it is claimed some firms have pushed up direct debits by even more (stock image)
Business Secretary Kwasi Kwarteng, left, has written to the head of energy regulator Ofgem calling on it to issue ‘substantial fines’ to enforce compliance. Ofgem has already launched a series of probes. Its Chief executive Jonathan Brearley, right
Chief executive Jonathan Brearley said they will include ‘stricter supervision of how direct debits are handled, how much firms are holding in customer credit balances, and ensuring companies are held to higher standards for overall performance on customer service and protecting vulnerable customers’.
He added: ‘This work will allow Ofgem to determine if companies are fulfilling their licence conditions and to work with them to rectify deficiencies.
‘Where they fail to do so, we will not hesitate to take swift action to enforce compliance, including issuing substantial fines.’
Mr Kwarteng said: ‘Now more than ever we need to closely scrutinise and hold energy companies to a high standard that the public rightly expect. The people who are suffering most as a result of high prices are customers, not energy suppliers.’