The energy price cap is set to rise from £1,971 to £2,800 a year in October, the chief of Ofgem told MPs.
Jonathan Brearley, chief executive of the energy regulator, told the Business, Energy and Industrial Strategy Committee he expects the cap to be “in the £2,800 range”, which will hit households already grappling with a cost of living crisis .
It came as former Ofgem chief executive Dermot Nolan said regulators could have stopped some of the sector’s defaults “if we had acted more quickly”.
Mr Nolan, who ran Ofgem between 2014 and 2020, told the committee that he did not believe a regulatory regime could have prevented the collapse of a large number of energy companies amid unprecedented gas and electricity price increases.
He described the 5-fold increase in wholesale energy costs as ‘once in 100 years’ and argued that Ofgem has followed government calls to prioritize competition over regulatory oversight as the ‘Big Six’ companies dominate the market.
The regulator has been heavily criticized for allowing too many companies to set up with minimal checks on whether they had the necessary skills or were financially resilient enough to weather large price swings.
Mr Nolan said that from around 2015 “many” new firms entered the market under a “permissive” regime “which was encouraged by the government but was also a conscious decision by Ofgem’s board”.
However, from 2017/18 it became clear that “in certain cases companies had entered the market in a speculative manner that it was probably not reasonable and not fair to do so and we had to do something about it”.
Mr Nolan said: “I don’t think any regime would have been entirely fit for purpose, but I accept that if we had acted faster we would have stopped some of the mistakes that have happened.”
https://www.independent.co.uk/news/business/ofgem-sunak-price-increase-cost-living-b2086103.html The energy price cap will rise to £2,800 in October, says Ofgem boss Sunak