The “high turnover” of regulation, largely coming from parliament, has hampered the suppliers’ customer service as their staff focus on complying with the regulations.
A spokesperson from the supply industry said the regulator and politicians “had to be seen to be doing something” and this has resulted in “an avalanche of stuff” being introduced.
These changes, including £50 that was knocked off energy bills, were said to be “short-term policies” that had to be rushed in despite not being fully thought through.
In their responses to Ofgem’s consultation on the CMA market investigation reference, two energy suppliers have criticised the continual creep of regulation.
Npower stated the significant increase in volume and impact of new regulation “may have been to the detriment of other changes to improve customer service”.
Eon said: “The approach taken has consumed a significant portion of our business’ capability to cope with change.”
First Utility, Centrica, SSE, and EDF Energy, in their consultation responses, were also critical of the introduction of regulation, and pressed for the CMA to investigate its impact on customer service and competition.
A spokesperson for Ofgem said: “If we were to make a reference, it would be for the CMA to decide which features to focus on within the scope of the terms of reference but we would fully expect and want this to include the action Ofgem has taken to intensify competition and protect consumers.
“An inquiry would clear the air for energy consumers and stakeholders.
“It would also allow the CMA to ensure that there are no further barriers to effective competition.”