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Daily Mirror
Daily Mirror
Business
Sam Barker

Martin Lewis apologises after branding Ofgem 'f*****g disgrace' over energy changes

Martin Lewis has said sorry for "losing his rag" on a phone call with energy regulator staff over coming changes to household bills.

The regulator, Ofgem, today said it wants to change how often energy bills will go up or down in price.

The proposals would see energy bill limits reviewed four times a year, rather than the current two.

That means the price you pay for energy would fluctuate more frequently.

Ofgem is also planning to hike the fee one energy firm pays another if it takes its customers when gas prices fall - and this is what really got Lewis annoyed.

The MoneySavingExpert founder had a call with Ofgem staff this morning, but said he got overheated at the thought that consumers might lose out.

On Twitter, Lewis said: "I'd like to formally apologise to the Ofgem staff for losing my rag in a background briefing just now and saying its changes are a 'f*****g disgrace that sells consumers down the river'. I should've behaved better.

"My ire's institutional not individual, it was inappropriate...

"I lost it when getting a briefing about today's proposals, where it feels like at every turn, in these desperate times where lives are at risk, it has ignored all asks for consumers and instead kowtowed to the industry (I hope history proves me wrong)...

"I finished the call by asking it to at least consider cutting standard charges, which huge rates stop people really saving by cutting energy use. I have had good meetings with Ofgem for years, so I'm sorry this blew up (they were calm I wasn't)...

"I pray when I do further analysis I have to apologise again as I've got it very wrong (if not I worry about dire consequences for consumers - we must do more to make things better for them)."

The energy regulator wants to bring in a fee payable by energy firms that bring out cheap deals - and it is under fire for being uncompetitive.

Ofgem's reasoning is that this fee will help energy firms stay trading, but Lewis thinks it is bad news for consumers.

That is because energy companies buy power before they need it, then sell it to consumers.

So if energy firm A buys energy at high prices, then energy firm B brings out a much cheaper deal, A could lose out by being pressured to sell energy for less than it bought it for.

Dozens of energy firms collapsed last year due to having to sell energy for less than they paid for it.

To stop this happening again when gas prices fall, Ofgem's solution is the 'market stabilisation charge'. This is a fee that energy firm B would pay to energy firm A for taking its customers if gas prices fall.

The changes were unveiled by Ofgem boss Jonathan Brearley today (handout)

This fee is 75% of the difference, and Ofgem now wants to make it 85%.

Lewis said: "My breaking point was hearing how, instead of listening to calls to scrap its proposed market stabilisation charge, it was making it harsher to really 'stop the harmful effects of competition'.

"I.e., staggeringly, it aims to effectively STOP firms undercutting the price cap..."

Ofgem is also reviewing how often it changes the price cap it oversees.

Energy bills will rise and fall much faster if this happens.

The price cap works by limiting how much the average home pays for power every year if they pay by direct debit on a variable rate tariff. The cap was introduced to help the most vulnerable households who are statistically most at risk of using these tariffs.

The price cap is currently reviewed once every six months.

Ofgem is now consulting on doing this every three months.

National Energy Action director of policy and advocacy Peter Smith said: "The changes significantly reduce the current protection the price cap affords all consumers over winter and opens the door to significant price rises during the coldest months of the year.

"In the short term at least, the changes will be particularly damaging for the poorest households; removing the certainty of the price they will pay over winter. This could cause further immense financial strain and damaging health and well-being as prices soar every few months."

What is the Ofgem energy price cap?

Despite what its name suggests, the price cap isn't technically a limit on how much you pay for energy.

Instead, it sets a limit on the unit rate a supplier can charge for each unit of gas and electricity you use and is currently reviewed twice a year.

The price cap is altered every six months, in April and October.

It was introduced in 2019 and is based on a number of factors including the wholesale cost of power in the previous six months.

How to get help with your energy bills

British Gas has an Energy Trust fund that can be accessed by anyone, not just British Gas customers, providing you meet the eligibility criteria.

Help is also available from the following energy providers, if you’re an existing customer:

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