Ofgem is threatening to refer energy companies to the Competition Commission over unfair pricing. The move comes as the energy regulator accuses suppliers of dragging their feet over price cuts.
Ofgem says it will launch a six-week consultation in January on possible changes to the licences of the UK’s six main energy suppliers. The move aims to ensure prices paid by customers on pre-payment meters and those paying by direst debit accurately reflect costs.
The regulator says energy companies were on track to cut £500m from bills but it says that it is not happy with the pace of progress. The price cuts were agreed after a investigation was launched in February amid concerns of unfair pricing and to end the practice of charging customers different amounts depending on their method of payment. Its initial findings were published in October when proposals were made to address unfair pricing (MW.co.uk October 6).
Ofgem says while some companies have delivered some of the savings it is not satisfied with the pace of deliver and warns the companies do not move swiftly, it will take further action, including a possible referral to the competition Commission for a full inquiry.
The watchdog says that as well as the new consultation launching in January it will press ahead with tightening rules on sales and marketing practices in the industry.