“It is essential that Ofgem uses the powers that Parliament has given it,” says BEIS secretary.

Greg Clark has increased the pressure on Ofgem by saying that the energy regulator must use its powers to cap bills.

Responding to a question in the House of Commons today, the BEIS (business, energy and industrial strategy) secretary confirmed that Ofgem has the legal power to introduce such a limit.

“For me, to oblige Ofgem to put a cap in place would seem excessive, it would require primary legislation, they have those powers, there is no need.

“That’s why, faced with this huge detriment – £1.4 billion on average – I believe that it is essential that Ofgem uses the powers that Parliament has given it to eradicate this detriment.”

Later, responding to a question from shadow business secretary Rebecca Long Bailey, Clark said: “I believe that they (Ofgem) should act on the evidence that has been presented to them, using their powers. The ball is in their court and I expect them to do their job and stand up for consumers.”

Commenting on Clark’s statement, John Penrose MP said he was “delighted” that the government was “standing up so robustly for consumers”.

“Ofgem now needs to get on and do its job. The Big Six energy firms have been milking and abusing their most loyal customers for decades and Ofgem was set up to protect them.  Ofgem have chosen to stand idly by, leaving 15 million customers on SVTs to be preyed upon by the Big 6.

“If Ofgem don’t have the guts to use their powers to go into battle on behalf of consumers, they should be replaced by a regulator which isn’t scared to do its job.”

In response to a written question in Parliament last week, junior business minister Margot James said that while Ofgem has extensive powers to establish a price cap on household energy prices, new legislation would be required in order to oblige Ofgem to put such a cap in place.

Ofgem chief executive Dermot Nolan has announced that the energy regulator is planning to consult on a “safeguard tariff”, which is designed to protect the poorest households, later this month. 

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