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Consumer care and
successful energy
reforms
Cathy Cottrell
First Secretary Energy Policy
& Head of Commercial Section
British Embassy, Kyiv
8 December 2017
OFFICIAL
Ofgem: independent regulator for
the UK’s Gas and Electricity
Markets
OFFICIAL
 a non-ministerial government department
 independent national regulatory authority
 recognised by EU directives
Key objective: to protect the interests of existing
and future electricity and gas consumers
Ofgem functions
OFFICIAL
 promotes value for money
 promotes security of supply and sustainability
 supervises and develops markets and competition
 regulates and delivers government schemes
 works with, but independently from, government, the
energy industry and other stakeholders within a legal
framework determined by the UK government and EU.
GEMA – the Gas and Electricity
Markets Authority (“the Authority”)
OFFICIAL
 determines Ofgem strategy
 sets policy priorities
 makes decisions on a wide range of regulatory
matters including price controls and enforcement
Authority members are appointed by the Secretary of
State at the Department of Business, Energy and
Industrial Strategy and include seven non-executive
Directors
Ofgem legislative framework
OFFICIAL
 Gas Act 1986
 Electricity Act 1989
 Utilities Act 2000
 Competition Act 1998
 Enterprise Act 2002
 Measures set out in a number of energy acts
Ofgem price controls
OFFICIAL
Ofgem funding
 annual licence fee (£49.1m in FY2015/16)
 cost control regime
 committed to saving 15% by FY2019-20
OFFICIAL
Ofgem key principles
 competition
 all reasonable demands for electricity must be met
 licence holders must be able to finance the activities
which are the subject of the obligations on them
 regard for the disabled, chronically sick, pensions,
those on low incomes and those living in rural areas
 transparency, accountability and consistency
OFFICIAL
Other important themes
 promoting value for money
 promoting security of supply
 promoting sustainability
 delivering government programmes
OFFICIAL
Key considerations
 are proposed regulatory requirements proportionate and
necessary to protect consumers?
 costs, benefits and social and environmental impacts
 consumer complaints
 social obligations
 support for vulnerable consumers
OFFICIAL
Consumer vulnerability strategy
OFFICIAL
https://www.ofgem.gov.uk/publications-and-updates/consumer-vulnerability-
strategy
Top 10 ways Ofgem made a positive
difference for consumer in vulnerable
situations
OFFICIAL
 redress
 unreturned credit balances
 connecting people to the gas grid
 online price comparison sites
 cost of calls
 pre-payment meters
 social tariffs
 free services to customers with additional needs
 support during outages
 advice
Ofgem enforcement action
OFFICIAL
Other activities
 2016 Competition and Markets Authority (CMA) report
https://assets.publishing.service.gov.uk/media/5773de34
e5274a0da3000113/final-report-energy-market-
investigation.pdf
 smart energy systems
https://www.ofgem.gov.uk/publications-and-
updates/upgrading-our-energy-system-smart-systems-
and-flexibility-plan
OFFICIAL
Ofgem and Europe
OFFICIAL
Ofgem supports the vision of a competitive and sustainable
European energy market that brings affordable and
secure energy supplies to consumers
European Regulators organisations: CEER and ACER
Thank you
OFFICIAL
https://www.ofgem.gov.uk/
cathy.cottrell@fco.gov.uk

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Consumer are and successful energy reforms

  • 1. Consumer care and successful energy reforms Cathy Cottrell First Secretary Energy Policy & Head of Commercial Section British Embassy, Kyiv 8 December 2017 OFFICIAL
  • 2. Ofgem: independent regulator for the UK’s Gas and Electricity Markets OFFICIAL  a non-ministerial government department  independent national regulatory authority  recognised by EU directives Key objective: to protect the interests of existing and future electricity and gas consumers
  • 3. Ofgem functions OFFICIAL  promotes value for money  promotes security of supply and sustainability  supervises and develops markets and competition  regulates and delivers government schemes  works with, but independently from, government, the energy industry and other stakeholders within a legal framework determined by the UK government and EU.
  • 4. GEMA – the Gas and Electricity Markets Authority (“the Authority”) OFFICIAL  determines Ofgem strategy  sets policy priorities  makes decisions on a wide range of regulatory matters including price controls and enforcement Authority members are appointed by the Secretary of State at the Department of Business, Energy and Industrial Strategy and include seven non-executive Directors
  • 5. Ofgem legislative framework OFFICIAL  Gas Act 1986  Electricity Act 1989  Utilities Act 2000  Competition Act 1998  Enterprise Act 2002  Measures set out in a number of energy acts
  • 7. Ofgem funding  annual licence fee (£49.1m in FY2015/16)  cost control regime  committed to saving 15% by FY2019-20 OFFICIAL
  • 8. Ofgem key principles  competition  all reasonable demands for electricity must be met  licence holders must be able to finance the activities which are the subject of the obligations on them  regard for the disabled, chronically sick, pensions, those on low incomes and those living in rural areas  transparency, accountability and consistency OFFICIAL
  • 9. Other important themes  promoting value for money  promoting security of supply  promoting sustainability  delivering government programmes OFFICIAL
  • 10. Key considerations  are proposed regulatory requirements proportionate and necessary to protect consumers?  costs, benefits and social and environmental impacts  consumer complaints  social obligations  support for vulnerable consumers OFFICIAL
  • 12. Top 10 ways Ofgem made a positive difference for consumer in vulnerable situations OFFICIAL  redress  unreturned credit balances  connecting people to the gas grid  online price comparison sites  cost of calls  pre-payment meters  social tariffs  free services to customers with additional needs  support during outages  advice
  • 14. Other activities  2016 Competition and Markets Authority (CMA) report https://assets.publishing.service.gov.uk/media/5773de34 e5274a0da3000113/final-report-energy-market- investigation.pdf  smart energy systems https://www.ofgem.gov.uk/publications-and- updates/upgrading-our-energy-system-smart-systems- and-flexibility-plan OFFICIAL
  • 15. Ofgem and Europe OFFICIAL Ofgem supports the vision of a competitive and sustainable European energy market that brings affordable and secure energy supplies to consumers European Regulators organisations: CEER and ACER