The ACS has urged energy regulator Ofgem to implement reforms proposed in a new consultation concerning changes to the way that energy suppliers engage with microbusiness customers.
The measures proposed in the consultation, available here, would amend the Standard Licence Conditions (SLCs) of energy suppliers to microbusinesses.
These amendments would make the SLCs include transparency over brokers’ fees and costs during the tender process; requiring suppliers to only work with brokers signed up to a qualifying alternative dispute resolution scheme; a 14-day cooling off period for new contracts; and banning suppliers from requiring microbusinesses to provide notice of their intention to switch provider.
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These changes would be significant for independent retailers, which may be classified as microbusinesses. Ofgem’s definition of a microbusiness requires a business to meet one of the following criteria:
- Fewer than 10 Full-Time Equivalent (FTE) employees and an annual turnover of less than €2m (£1.72m)
- Annual electricity consumption of less than 100,000kWh
- Annual gas consumption of less than 293,000kWh
The ACS said that proposing the reforms was welcome, but that Ofgem should implement them to help rectify long-standing issues in the market.
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ACS chief executive James Lowman said: “This is a welcome step forward from Ofgem, but one that we have seen several times before. Many of the specific measures being proposed in this consultation have been being discussed and put forward in various guises for the last decade, but ultimately little action has been taken.
“We urge Ofgem to implement these reforms to the microbusiness energy market as soon as possible to give the smallest businesses the protections they need when dealing with energy companies and brokers.”
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