Energy Ombudsman support to expand to cover all businesses with fewer than 50 employees

Small businesses with fewer than 50 employees will be entitled to free support from the Energy Ombudsman on disputes with their energy supplier under an expansion of the scheme.

The change is part of a joint effort by government and energy sector regulator, Ofgem, to tackle unfair practices including hidden fees, inaccurate billing and pressurising sales tactics for commercial energy customers.

The Ombudsman has the power to order suppliers to provide compensation of up to £10,000 or take action to resolve issues – such as raising standards for their customers, or to credit or amend customer accounts – and will now cover 99% of British businesses.

The move will also enable businesses and other organisations to settle disputes with their energy broker via the Ombudsman, without the need for costly legal proceedings. Energy Affordability Minister Amanda Solloway has warned energy brokers to end these unacceptable practices, with the government planning to consult later this year on regulating brokers and other third-party intermediaries.

Minister for Affordability and Skills Amanda Solloway said:

“All businesses deserve to get a good service from their energy supplier – and today’s changes will empower small businesses with free redress support via the Ombudsman.

“This is just the beginning. Rip-off energy brokers have no place in our market and we will act to raise standards for customers.”

Energy brokers are used to help small businesses and organisations, like charities or schools, find the best energy deal for their needs – which larger businesses often manage in-house. This can leave smaller organisations vulnerable to unfair fees, with only the courts as a route to redress.

Households and companies with fewer than ten employees can already use the Ombudsman to settle disputes with their energy supplier – including energy bills, customer service, or how a product has been sold by an energy supplier. The expansion to this service coupled with the reforms from Ofgem will come into force later this year, empowering small organisations to seek redress from both suppliers and brokers over any unfair terms in their future energy contracts.

Ed Dodman, Director & Chief Ombudsman for Energy Ombudsman commented:

“We’re very pleased with this announcement – we believe that businesses should have the same access to support as consumers and the addition of small businesses is very much welcomed.

“It now means that they have access to a free, impartial and independent body to help them resolve disputes with their energy supplier. By extending the services to cover all small businesses, it fills an existing protection gap and means organisations, who may have more limited resources, will be able to access the support they need.”