Small businesses to get access to Energy Ombudsman for the first time

Following today’s announcement from the Department of Energy Security and Net Zero (DESNZ), businesses will soon have access to free support to resolve issues with their energy contracts, as part of government and Ofgem changes to tackle hidden fees, energy bill issues and being mis-sold services. The changes, coupled with the reforms from Ofgem, are expected to come into force in Q4 this year with further details to be announced in due course.

Energy Ombudsman welcomes the news that small businesses with fewer than 50 employees will be able to get free support on disputes with their energy supplier – extending the service to cover 99 per cent of all businesses in Great Britain. They will also have the power to order suppliers to provide compensation of up to £10,000 or take action to resolve issues.

The move also enables businesses and other organisations to settle disputes with their energy broker, without the need for costly legal proceedings. It’s a first step in a crackdown on rogue energy brokers targeting small organisations with thousands of pounds in hidden fees.

Energy Affordability Minister Amanda Solloway has today warned energy brokers to end these unacceptable practices, with the government planning to consult later this year on regulating brokers and other third-party intermediaries.

Minister Solloway added: “We take pride in our British businesses and that’s why this government will always stand by entrepreneurs. All businesses deserve to get a good service from their energy supplier – and today’s changes will empower small businesses with free redress support via the Ombudsman. This is just the beginning. Rip-off energy brokers have no place in our market, and we will act to raise standards for customers.”

Ed Dodman, Director & Chief Ombudsman for Energy Ombudsman said: “We’re very pleased with this announcement – we believe that businesses should have the same access to support as consumers and the addition of small businesses is very much welcomed. It now means that they have access to a free, impartial, and independent body to help them resolve disputes with their energy supplier. By extending the services to cover all small businesses, it fills an existing protection gap and means organisations, who may have more limited resources, will be able to access the support they need.”

Alongside today’s announcement, Ofgem also set out wider plans to improve energy services for businesses and other non-domestic consumers. These include:

• A new requirement for energy brokers to provide full transparency over fees within their contracts, so customers can access the competitive choice they deserve.
• A change in rules that will mean energy suppliers can only work with brokers who are part of a redress scheme, when securing small business contracts. This will ensure these customers always have access to free and fair support with any disputes, helping to rebuild confidence in broker services.
• Signposting non-domestic customers to a range of redress routes in addition to the Energy Ombudsman, by allowing small organisations to raise complaints against their broker or supplier via alternative advice services, such as Utilities Intermediaries Association. Expanding their Standard of Conduct rules for energy suppliers to ensure all businesses receive the same level of support with issues, such as making it easy for businesses consumers to contact their supplier and access the information they need.