Energy regulator Ofgem has started a conversation with key stakeholders on its new Consumer Vulnerability Strategy until 2025. The Consumer Vulnerability Strategy outlines five themes with outcomes that Ofgem is seeking views from stakeholders and consumers on:

  • Improving identification of vulnerability and smart use of data
  • Supporting those struggling with their bills
  • Driving significant improvements in customer service
  • Encouraging positive and inclusive innovation
  • Working with partners to tackle issues that cut across multiple sectors

While the price cap is in place it is expected that digitalisation, decarbonisation and decentralisation are likely to change the way consumers interact with their energy suppliers.  These may fundamentally alter the energy market. Ofgem is determined to ensure that the interests of consumers, especially the vulnerable, are protected and they can benefit from these changes.

Ofgem’s previous Consumer Vulnerability Strategy strengthened protections for consumers in vulnerable situations by introducing new rules to support the most vulnerable. Ofgem has undertaken strong compliance and enforcement activity to make sure energy companies comply with these rules to protect these consumers.

The success of the Consumer Vulnerability Strategy has resulted in nearly eliminating disconnections for debt. In the new Consumer Vulnerability Strategy, one of our first priorities is to strengthen protections for consumers in vulnerable situations who self-disconnect from their pre-payment meters.

Ofgem is also concerned suppliers aren’t doing enough for people in debt. Ofgem is considering putting in place rules that ensure a customer’s ability to pay is properly considered when setting repayment plans, monitoring repayments and ensuring consumer understanding of arrangements.

Mary Starks, Executive Director, consumer and markets at Ofgem said “We want to ensure that the energy market works well for everyone, including those least able to look out for themselves. Supporting and protecting customers in vulnerable situations is a key priority for Ofgem.”

“Energy is changing, as the sector rises to the challenge of decarbonisation with the creation of new businesses and business models. We cannot have a situation in which the most savvy and affluent customers benefit from these changes, while others are left behind. That is why we want to work with consumer groups and the industry to create a fair energy market for the future.”

Joanna Elson OBE, Chief Executive of the Money Advice Trust, who served as a member of the Commission for Customers in Vulnerable Circumstances, said “This increased focus on vulnerability in the energy sector is a welcome one, and shows that there is the will from the regulator to improve support for energy customers in vulnerable circumstances.VAt National Debtline, household debts, such as energy, are increasingly making up a significant part of the debt landscape.”

“I am particularly pleased to see the regulator looking at strengthening support for customers facing payment difficulty and encouraging suppliers to be more proactive – something we have long called for.”

“Following the recent report from the Commission for Customers in Vulnerable Circumstances, it feels like momentum is growing to improve practice across the energy sector.”

“However, as last week’s report identified, significant work is needed to improve the consistency of support across the sector. It is now up to suppliers and the industry as a whole to act. There is an important role for the third sector to play and we look forward to building on our existing work with energy firms to access the advice and help they need.”