Net Zero Watch warns over change to Ofgem role
By Paul Homewood
Amendment to Ofgem’s statutory duties ‘leaves consumers defenceless in the face of green rent-seeking’
London, 9 June – Rather than restoring Ofgem as a consumer champion, Rishi Sunak’s government is actually weakening the regulator’s ability to protect consumers against the unreasonable costs of the UK’s poorly designed and extremely expensive climate change policies. This is, quite simply, a deplorable mistake and will store up horrifying problems for future governments, to say nothing of the serious harm it will do to household wellbeing and the competitiveness of UK businesses.
As long ago as 2017, we pointed out that the regulator of the Office of Gas and Electricity Markets (Ofgem) had been systematically transformed from a defender of the energy consumer interest into a supine part of the climate policy delivery mechanism, a point we reinforced in a more recent article (The Decline and Fall of Britain’s Energy Regulator).
Ofgem’s original statutory duty compelled it to promote the interests of existing and future consumers through the promotion of competition. This was a clear and rational objective for a consumer champion.
The revisions made in the Energy Act of 2010 redefined these interests to include the consumer interest in reducing greenhouse gas emissions. This was dubiously logical, since it is not clear that consumers qua consumers have such interests, and needless since those interests, insofar as they were real, were already represented in the arguments being made for emissions reductions policies by the relevant government departments, DECC and DEFRA at that time.
By prejudging the debate between these interests the revision to the 2010 Act in effect made it very hard for any diligent economist in Ofgem to offers substantive criticism of very high emissions reduction costs.
However, it seems that this was not sufficient for those intent on removing any obstacle to cost increases caused by climate change policy, and Government is now proposing to finish the job begun in the 2010 Act by making it explicitly committed to working towards the delivery of the Climate Change Act of 2008. To be exact, as Ofgem itself reports:
"It gives Ofgem a specific net zero mandate to protect existing and future consumers’ interests by supporting “the Secretary of State’s compliance with the duties 1 and 4(1)(b) of the Climate Change Act 2008 (2050 net zero target and five-year carbon budgets).”
Reviewing the history, it is difficult to avoid the conclusion that Ofgem has been to a degree complicit and under the leadership of Mr Brearley, whose doubtful objectivity in this matter we have discussed in our 2020 article, positively enthusiastic in weakening consumer protection.
Any consumer, whether domestic or industrial, might reasonably ask “What is the point of a regulator such as Ofgem?” From the government’s point of view, the point is crystal clear: the existence of a drugged and hypnotised regulator gives the false impression that the consumer interest is balanced against Net Zero policies. The wording of the government amendment in fact shows that Mr Sunak’s colleagues couldn’t care less.
Comments are closed.
This reminds me of the Personnel departments of old, who looked out for the interests of employees. They evolved into HR departments looking out for the interests of management, protecting them from belligerent employees.
Its Orwellian. Future customers to be protected form the ravages of climate change by ripping off existing customers and in reality making them serve the aims of a belief system that has precious little to do with ‘climate’.
Disgraceful. Actual consumers seem to be ignored by these changes. What is the point that Ofgem even exists?
What is really needed is immediate repeal of the “Climate Change Act”
Ever since SSE got swallowed by OVO, we have been bombarded with ‘sorry to have to tell you this, but…’ emails that they want money now for what they think might happen a year hence. We are not their investment bank.
To correct their auto imposed hike on a plummeting usage over summer will undoubtedly take a ton of time.
I just fought British Gas on a separate issue and won… after several months. My MP and OFGEN were involved but I had to do all the work.
It is an establishment complicity con. And my MP will be informed of such. He was a minister at the DCMS too, so given his stellar ineptitude with the BBC/OFCOM I have few hopes.
I too was an SSE customer and have decided to take my business elsewhere. I have chosen the market leading atomic energy electricity supplier.
Who is ofgem’s paymaster?
Well then, what do you expect? The fact that the money comes from the taxpayer and the consumer doesn’t register with politicians or troughers
OFGEM are the main cause of our high electricity prices and to some extent high gas prices. Approving a load of financial suspect suppliers who all went bust taking our credits with them and then having the cheek to put a levy on all of us to get the money back, particularly doubling the electricity standing charge for all customers including pre payment meters (generally the poorest). Pushing net zero on government orders, smart meters, wind farms etc etc.
They just gave up on protecting the customer from high prices, putting Jonathan Brearley (co wrote climate change act) in charge was putting the fox in charge of the chickens.
If OFGEM had never existed the gas/electricity markets would be in much better shape and competition would have given lower prices.
The problem is European politicians don’t like free markets (not even those these days claiming to be Conservatives in the UK) and want to control _everything_.
It’s not only the “climate” and “green” scams, just look at the resurgence of the nanny state in many other areas.
>>competition would have given
Its the same as The Big Guy 10% Joe Brandon’s “all of government” policy. Agencies with absolutely no remit related to energy or environment are drafted into mindless regulations (e.g. Securities and Exchange Commission) supporting the Nut Zero schemes.
So Brearley, the poacher-turned-gamekeeper, is now mandated to go back to poaching.
It’ll be like living in South Africa.
I don’t think Ofgem, led by Mr. Brearley, can be described as the “supine part of the climate policy delivery mechanism”. I think they’re driving this economy destroying CAGW/Net Zero nonsense. Rather it’s their original mandate to protect the consumer which is “supine”.
What a surfuckingprize.
Another turn of the screw…
Something is going to give soon.
100%.
Ukraine is the blue touch paper.