New industry rules put in place by Ofgem will mean that energy companies will need to give their customers 30 days notice of any price rises. This represents a significant shift from the previous rules which said that they must inform consumers within 90 days after a price increase.
Mark Todd from comparison site Energyhelpline.com has commented that reform to this area of the regulation is long overdue. He points out that no other retailer would be able to charge more for their product without informing their customer and yet expect them to carry on paying for their product.
The comparison site estimates that £146 million could have been saved by UK energy users if the new rules had come into effect before the major suppliers all increased their prices in the last few months. It is suggested that homeowners would have been able to switch suppliers to avoid price hikes.
Andrew Wright from Ofgem has said that 30 days advance notice of price increases along with more transparency and an end to complex tariffs will make it easier for consumers to decide when is the best time to switch suppliers.
Ofgem will also be tackling the issue of the failure of energy suppliers to pass falls in energy prices on to their customers. The regulator has found evidence that suppliers have been raising prices in line with the wholesale price but are not reducing prices when the wholesale price dips. A report on this issue is due for later this year.