Ofgem have opened a consultation for a proposal that could eventually reduce household energy bills.
The idea is that new and existing suppliers with less than 50,000 customers won’t have to offer energy to every household, encouraging more competition and new business models.
Currently suppliers must follow the Universal Service Obligation (USO) which makes it difficult for them to specialise. However the new proposed requirements will allow suppliers to offer specific services for electric vehicles, batteries and heat pumps.
Boosting competition in the market could lead to better offers becoming available for households, making electricity bills cheaper.
Neil Kenward, Director General, Markets, for Ofgem said: “Reducing barriers for new suppliers should encourage innovation, clearing the way for consumers to access a wider choice of new services to help lower their bills.
We want to make it easier for customers to participate in a smarter, more flexible and competitive energy system, while maintaining key consumer protections.”
In Ofgem’s continued bid to meet its long-term decarbonisation and affordability goals, the requirements should also make use of low-carbon technologies and support a cleaner energy system.
The consultation is currently open for suppliers, consumer groups an charities to respond and will close on the 16th September.
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