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New Ofgem rules to offer greater protection for businesses

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Businesses will get fairer treatment, more support resolving disputes and greater transparency on broker fees under new rules announced by Ofgem, the regulator says.

The changes will apply to the non-domestic energy sector, which includes businesses, public services like sports centres and village halls, utilities, charities and more.

The new rules will make sure energy suppliers improve customer service, open doors to alternative dispute resolution schemes and clearly set out costs for businesses, including fees paid for third party services, like energy brokers.

Under the changes, Ofgem will from 1 July 2024:

  • Expand the Standards of Conduct to apply to all businesses of any size, rather than just Micro Business consumers. This will give Ofgem powers to take action against suppliers that do not treat non-domestic customers fairly.
  • Introduce a new supply licence rule for non-domestic suppliers which requires them to signpost Micro Business consumers to Citizens Advice and Citizens Advice Scotland, who can offer support and advice when they have an issue. This will also apply to Small Business consumers from December 2024, subject to the new definition entering legislation.

Further changes, that Ofgem expects to be in place by the end of the year, include:

  • Expanding the requirement for a contract’s principal terms to clearly display any broker fees from Micro Business consumers to all non-domestic customers. This will apply to contracts signed on and from 1 October 2024 and suppliers must make this information available upon request.

From December 2024, in line with the government’s proposed new Small Business consumer definition entering legislation, Ofgem will also:

  • Update the Complaints Handling Standards to ensure suppliers put in place suitable complaints processes for Small Business consumers and point them to the Energy Ombudsman when a customer does not feel the issue has been resolved.
  • Implement a requirement for suppliers to only work with Third-party Intermediaries (TPIs), often referred to as brokers, that are members of a redress scheme when securing Small Business contracts. This will provide reassurance to business customers that they are able to access dispute resolution schemes and get a fair and suitable outcome.

Tim Jarvis, Ofgem’s Director General for Markets, said: “Too many businesses have experienced issues with some energy suppliers, from difficulty getting the right contracts, unexplained price hikes, and poor customer service.

“We’ve worked hard to understand the breadth of issues and where the powers we have to tackle them can be improved. These new rules will help ensure businesses get the service they deserve.

“We’ll be speaking to businesses of all sizes as these rules come into force throughout this year to make sure they are being followed by suppliers. We’ll also continue to work with government, industry, and consumer groups to see what else can be done to support non-domestic consumers.”

Ofgem’s new rules come as the government confirms plans to expand its definition of Small Businesses, meaning businesses with less than 50 employees and a certain turnover or using a certain amount of energy can take complaints about their energy supplier to the Energy Ombudsman.

Under new Ofgem rules, Small Businesses will also be able to resolve disputes about third parties like energy brokers with redress scheme providers, such as the Energy Ombudsman and the Utilities Intermediaries Association (UIA). This was previously only available for Micro Business consumers so the change will give more businesses access to independent support with complaints.

The changes being brought in by Ofgem to help businesses result from concerns shared last year about problems including poor customer service and complaint handling from those in the non-domestic energy market. This prompted a joint deep dive to learn more about these issues with the Department for Energy Security and Net Zero (DESNZ), the full results of which have now been published.

More than half of those taking part in the research (58%) said they were concerned about the impact of energy prices on their business, with 42% reporting they were very concerned. And almost two thirds (60%) of businesses were satisfied with the overall service they had received from their supplier, with 13% saying that they were dissatisfied.

The main reasons consumers said they were dissatisfied included the service being too expensive, poor customer service, and poor communication from their supplier.

Photo by krakenimages on Unsplash

ENERGY METERING MONTH: Powering up insights for Energy Managers

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The ever-fluctuating cost of energy and increasing pressure to achieve sustainability goals are placing unprecedented demands on energy managers in the UK’s public and private sectors. Here, we explore the key recent and future trends in energy metering solutions, empowering energy managers to take control of their energy consumption, based on input from attendees at the Energy Management Summit…

Recent Trends:

  • Smart Metering Rollout: The rollout of smart meters is enabling real-time energy data collection, providing valuable insights into usage patterns and potential areas for optimization. Energy managers can identify peak usage times and implement targeted energy-saving measures.
  • Cloud-Based Data Management: Cloud-based platforms are simplifying data storage, analysis, and visualization. This allows energy managers to access data remotely, monitor trends, and generate reports easily.
  • Integration with Building Management Systems (BMS): Energy metering solutions are increasingly integrating with BMS, allowing centralized control of lighting, heating, ventilation, and air conditioning (HVAC) systems. This promotes energy efficiency and optimizes building performance.
  • Focus on Non-Metered Energy Sources: Solutions are emerging to estimate and track energy consumption from non-metered sources like compressed air systems or kitchen equipment, providing a more holistic view of energy usage.

Future Trends:

  • Artificial Intelligence (AI) and Machine Learning (ML): AI and ML will play a vital role in future solutions. These technologies can analyze energy data, identify consumption anomalies, and predict future usage patterns, enabling proactive energy management.
  • Internet of Things (IoT) Integration: The integration of IoT devices like smart sensors will provide real-time data on environmental factors like temperature and humidity. This allows for further optimization of HVAC systems and reduces energy waste.
  • Distributed Energy Resources (DER) Management: As more businesses adopt renewable energy sources like solar panels, solutions will be needed to manage and integrate DERs with the main grid, ensuring a reliable and efficient energy supply.
  • Focus on User Engagement: Future solutions will incorporate user-friendly interfaces and gamification elements to encourage occupant engagement in energy-saving behaviours within buildings.
  • Cybersecurity for Metering Infrastructure: With increased reliance on connected devices, robust cybersecurity measures will be crucial to protect against data breaches and ensure the integrity of energy data.

Benefits for Businesses and Organisations:

Investing in advanced energy metering solutions offers several benefits:

  • Reduced Energy Costs: Real-time data insights empower energy managers to identify and address inefficiencies, leading to significant cost savings.
  • Improved Sustainability Performance: By optimizing energy use and potentially increasing reliance on renewables, organisations can reduce their environmental footprint and meet sustainability goals.
  • Enhanced Operational Efficiency: Integration with BMS allows for automated control and streamlined operation of building systems, maximizing efficiency.
  • Data-Driven Decision Making: Energy data empowers data-driven decision making regarding future energy procurement, infrastructure upgrades, or energy-saving initiatives.
  • Improved Compliance with Regulations: Robust metering solutions can help organisations comply with energy reporting regulations and carbon emission reduction targets.

Energy metering solutions are evolving rapidly, offering UK energy managers powerful tools to navigate the complex energy landscape. By embracing these trends and leveraging the power of data and technology, energy managers can ensure efficient and sustainable energy use for their organisations. This translates to cost savings, a reduced environmental impact, and a more secure energy future.

Are you searching for Metering solutions for your organisation? The Energy Management Summit can help!

Photo by Natalya Letunova on Unsplash