The four core tariff per fuel, per payment type regulation has gone live today, whilst the regulator has also banned “complex tariffs”.
The new rules mean that suppliers can no longer offer two-tier tariffs but must instead offer customers tariffs made up of a standing charge and a single unit rate.
Further RMR reforms will be introduced in April this year, requiring suppliers to provide their customers with clear, routine information, including personalised information on what the cheapest tariff is for them.
Andrew Wright, interim chief executive at Ofgem, said: “It is getting easier for consumers to get a better energy deal and by April further help will arrive in the form of much clearer and personalised information.”
Wright added: “Now it is up to the suppliers to build on our reforms to restore consumer confidence in the energy market. There are good signs that they are taking up this challenge.”
Angela Knight, chief executive of Energy UK, said the suppliers are “working hard to rebuild trust” with consumers.
She added: “If you look at the market now, the deals are fewer in number and much easier to compare.
“Customers will see improvements to the information they get as a result of energy companies bringing in the changes set out in the RMR and this should help people get he best deal for them.”
However, both Which? and Consumer Futures said that whilst the tariff cap was a “step in the right direction” more still needed to be done.
The chief executive at Consumer Futures, Mike O’Connor, said: “We have allowed what should be a market for an essentially simple service to become a byword for complexity and confusion and sometimes very dubious practices.
“It would be naïve to assume that this will sort out the energy market once and for all.”
Richard Lloyd, executive director at Which?, added “they just do not go far enough to boost competition and help consumers find the cheapest deals at a time when millions are struggling with the cost of living”.