ENERGY companies could face an Ofgem crackdown after whacking rip-off surcharges on hard-up boozers, bars and bistros.
The watchdog and ministers have slapped down the firms after complaints from hospitality businesses who’ve been crippled by excessive demands for payment upfront, inflated admin fees or restricted access to the best deals.
Suppliers could face fines if Ofgem decides to act
Suppliers could face fines while junior ministers held a meeting with energy companies to hold them to account and set “clear expectations” of their behaviour.
It comes as Chancellor Jeremy Hunt will announce this week business energy support will be extended beyond March – but the support will be slashed.
In a letter sent by Ofgem late last year the watchdog warned: “suppliers should not profit from the current state of the market in a way that negatively impacts customers and must not subvert the intent of the Energy Bill Relief Scheme.”
It added: “We are reviewing our options to introduce additional regulations to protect all non-domestic consumers.”
Mark Selby, boss of Mexican restaurant chain Wahaca said his supplier demanded £740,000 up front for energy last year.
He said: “I would have liked to have seen some form of restriction on the energy companies as to the extent they could apply a premium because it just feels completely unnecessary when the government has made such a big sacrifice.
“It’s just to top up their profits.”
Industry body UKHospitality said their members were reporting inflated prices for “no justifiable reason.”
Kate Nicholls, the body’s Chief Exec said: “Their actions hiking prices, demanding excessive deposits and singling out hospitality as ‘high risk’ is undermining the Government’s intention to support businesses, and leaving hospitality as collateral damage in the greedy pursuit of excess profits.
“We now need to see Ofgem properly step up and hold energy suppliers’ feet to the fire to force a change in their behaviour.”
A business department spokesperson said: “The Energy Bill Relief Scheme establishes a robust enforcement and compliance regime to ensure non-domestic customers receive the full benefit of the discount provided.
“The Government is working with Ofgem to understand the scale of the issue and ensure energy suppliers are acting appropriately.”
An Energy UK spokesperson added: “Energy suppliers have worked hard to implement and administer the Energy Bill Relief Scheme.”
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