Following its Statutory Consultation on short-term interventions-consultation at the end of 2021, energy regulator Ofgem has introduced two time-limited measures to help stabilise the energy market.
An Ofgem spokesperson said: “The energy market has faced a huge challenge due to the unprecedented increase in global gas prices; a once in a 30-year event. We’re putting in place short-term measures to protect consumers.
“All suppliers will have to offer existing customers the same deals available to new customers.
“This will ensure customers can benefit from all tariffs available in the market and enable more consumers to benefit when wholesale prices fall. We’ll monitor how effective this is before considering whether it should become an enduring measure in the market.
“Suppliers will also be required to pay a Market Stabilisation Charge to the losing supplier when acquiring a new customer, which will only be triggered if wholesale prices fall considerably below the level assumed in the price cap.
Alongside tougher financial regulation, this will make sure that energy companies do not take disproportionate financial risks and suppliers who have done the right thing by purchasing energy in advance for their customers aren’t penalised, whilst protecting the ability of switching consumers to benefit from cheaper tariffs when prices fall.”
The stakeholder responses to the consultation can be found on the Ofgem website.