Flexible and responsive energy retail markets
Detail of outcome
We will consult on more detailed policy proposals through our consultation on opt-in and testing opt-out switching and will continue to assess the rationale for wider retail regulatory reform through 2021. The switching schemes consultation and subsequent work will represent the government’s response to this consultation and set out the government’s more developed policy thinking as informed by the responses to this consultation.
The joint review phase of the project is now over. The government and Ofgem will take forward the policy making process for their respective areas independently from now on, but still in close consultation with one another:
- BEIS will consider whether market reforms, including changes to the form and scope of regulation of participants in the retail energy, are necessary and appropriate to facilitate and encourage the energy transition and meet the net zero target
- Ofgem will continue to use its existing powers to enable competition and innovation, to protect consumers and to decarbonise at lowest cost
Alongside this read:
- the Energy retail market strategy for the 2020s
- the consultation on Energy retail: opt-in and testing opt-out switching
Feedback received
Detail of feedback received
We received a total of 60 responses from, among others:
- large and small suppliers
- industry groups
- consumer groups
Respondents generally agreed that a future retail market must decarbonise and embrace the benefits of flexibility, while ensuring fair prices and appropriate safeguards, especially for consumers in vulnerable situations.
Original consultation
Consultation description
In November 2018, BEIS and Ofgem launched a joint review to investigate what policy, legal and regulatory changes might be needed to ensure that the energy retail market is fit for the future.
The review aims to enable consumers to take advantage of the increased flexibility and lower costs of a smart, low-carbon energy system whilst appropriately safeguarding all consumers. It also supports delivery of the government’s commitment to fully decarbonising the energy system with net zero emissions across the whole economy. It is vital that the energy retail market is flexible and agile enough to keep up with this transition and deliver benefits for all consumers.
This consultation sets out our vision for the future energy retail market, the key challenges we need to address and the outcomes we want the energy retail market to deliver. It includes:
- how the regulatory framework could be changed to facilitate the launch of products and services that may be frustrated today, and which support decarbonisation
- market distortions and where implementing reforms could improve the functioning of the retail as a dynamic and competitive sector
- how the retail market can deliver a good deal for all consumers, as they should not face excessive prices and should receive a good level of service
The consultation will be of interest to:
- individual energy supply and network companies
- energy industry representatives
- third party intermediaries in energy and/or other sectors
- consumer and environmental groups
- innovators
but any organisation or individual is welcome to respond.
Please copy your responses to both BEIS and Ofgem
We would be grateful if you could copy your responses to both bodies:
Energy Markets and Affordability Team
Department for Business, Energy and Industrial Strategy
Abbey 1, 3rd Floor,
1 Victoria Street
London
SW1H 0ET
Email: energyretailmarketsreview@beis.gov.uk
Future Retail Market Design Team
Ofgem
Office of Gas and Electricity Markets
10 South Colonnade
Canary Wharf
London, E14 4PU
Email: futuresupply@ofgem.gov.uk
Documents
Last updated 23 July 2021 + show all updates
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Government response published.
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First published.