The new rules, introduced on April 1, require energy companies to speed up the time they take to move households over if they switch suppliers or face having to pay compensation
Ofgem has brought in new rules and it could see customers receive compensation payouts from energy firms.
The new rules, introduced on April 1, require energy companies to speed up the time they take to move households over if they switch suppliers. From this month, energy firms need to complete energy switches within five working days or face a fine. This fine sits at £30 and would be paid to the energy customer as compensation.
The five working days deadline has been around for a while now however, energy firms would only have to pay out compensation if they hadn’t switched a customer over within 15 working days.
The move was made after Ofgem found there was an increase in people switching energy suppliers last year. More Brits were found to be switching gas and electricity providers as more fixed tariffs entered the market. At the time of the announcement, Ofgem said the rule changes would empower customers to “take control of their energy bills”. Prior to 2022, if you wanted to switch energy suppliers, you had to wait up to 21 working days.
At the time of the announcement, Melissa Giordano, deputy director for retail systems and processes at Ofgem, said: “Customers who see better energy deals on the market or experience poor service must be able to vote with their feet and move energy supplier – quickly. As regulators, we have already slashed the amount of time within which suppliers must switch a customer by two-thirds to just five working days.
“We are now going further by requiring any supplier who misses that deadline to pay the affected customer £30. We are already seeing switching levels up from last year, and now, this new move – welcomed by leading charities – will further empower customers to take control of their energy bills.”
Last year, Ofgem took action against three energy suppliers who failed to provide compensation for customers who waited more than 30 days to receive a final bill from their old supplier when they switched to another company. Octopus, E.On Next, and Good Energy either missed or unduly delayed the compensation payments which are due if a supplier does not provide a final bill within six weeks when a customer switches to another provider.
