Greg Clark has expressed hopes that the ‘end of the road’ is nearing for standard variable tariffs and warned Ofgem that it will have to respond more rapidly to changes in the market than it does now.
The secretary of state for BEIS (business, energy and industrial strategy), told a fringe meeting this morning (Monday October 2) at the Conservative party conference that a cap on SVTs could be achieved more rapidly by Ofgem using its existing powers rather than fresh legislation in Parliament.
Clark, who warned in a newspaper interview this weekend that Ofgem faced its ‘last chance’ to introduce a price cap on SVTs, said: “Of course we are prepared to act through Parliament but everyone knows that taking things through Parliament takes much longer and we want to bring relief to consumers. I hope we are reaching end of the road for standard default tariffs.”
“There is no question of a stalemate: we will act whatever they say.”
Pointing to how Ofgem has not yet responded to the findings of the Competition and Markets Authority investigation into the energy market, Clark said regulators had to respond more rapidly in the light of evolving technology.
“The fact that have had to had to wait a year for the regulator to act on the recommendations of that report is not agile. I would like to see regulators generally be much more fleet of foot and act much more quickly and anticipate the problems that come from technology,” he said, adding that regulators should take into account how suppliers can use their increasingly detailed knowledge of customer behaviour to identify those stuck on poor value SVT deals.
Clark also expressed confidence that the UK and EU energy markets would remain closely integrated following Brexit.
“Energy is an area where the obvious advantages of being able to continue to trade are so apparent that it would be completely crazy to have any interruption of that.
“This is one of best examples of where there is a strong common interest in a sensible deal. I would hope and expect that progress we make on energy will pave the way for similar sensible arrangements in other areas.”