Britain’s energy regulator, Ofgem, is facing a boardroom overhaul amid stinging criticism over its handling of the energy crisis.
Over the coming months, ministers will recruit new directors to fill five of the eight seats on the board, including the role of chair, but the chief executive, Jonathan Brearley, is expected to remain in position.
Ofgem has faced criticism of its approach after almost 30 suppliers went bust during the energy crisis. Recently it has also been under fire over its handling of the prepayment meter scandal.
The Department for Energy Security and Net Zero has launched a process to find a new chair to replace Prof Martin Cave, who will not seek to be reappointed when his five-year term ends in October. The chairman role pays up to £180,000 for about three days a week of work.
Officials also hope to find four new non-executives, including replacements for two recently departed directors, Christine Farnish – who quit last year in an argument over the Ofgem price cap – and Paul Grout, who left in 2021. Lynne Embleton and John Crackett, who have terms due to expire this year, may also be replaced but could seek reappointment to the board.
Cave, an author and chair of several UK universities, has overseen an unprecedented period at Ofgem, during which time its attempts to improve competition in the energy supply market were undermined by the string of supplier failures which cost taxpayers an estimated £2.7bn.
The introduction of the Ofgem price cap, which aimed to keep a lid on bills, meant suppliers were left unable to pass on wholesale costs to customers when gas prices began to rise sharply in 2021.
More recently, Ofgem has been criticised for its handling of the prepayment meter scandal. MPs and campaigners warned before Christmas that many households risked going without heat or light because they could not afford to top up their meters.
Ofgem later launched a review into supplier practices and was then bounced into introducing a temporary ban on prepayment meter installation after it emerged debt agents working for British Gas had force-fitted prepayment meters into vulnerable people’s homes.
This week Brearley told energy suppliers to uninstall prepayment meters that have been wrongly force-fitted and pay compensation now, rather than wait for the outcome of a review.
Brearley has resisted calls to resign, including from the former prime minister Gordon Brown.
Audeliss Executive Search has been appointed to hunt for board members to replace those who are leaving, according to Sky News, which first reported the boardroom shake-up.
A government spokesperson told Sky: “Audeliss are specialists in the recruitment of diverse executive and board level appointments. The recruitment process is in progress. The new Ofgem chair and non-executive directors will be announced in due course.”
Ofgem confirmed “Professor Cave will not be seeking reappointment for the role”.
Dame Meg Hillier MP, the chair of the public accounts committee, which published a damning report into Ofgem last year, told the Guardian: “I would like to see appointments which are not political but of people who really understand the many issues in the energy industry. They need someone with strategic vision as chair who can be nimble enough to see the changes and challenges that are likely to come in the near future.”
Sources close to the Ofgem board said Cave had been an “invisible” chair and should have taken a higher-profile role during the energy crisis.
“Part of the chairman’s role is to protect the chief executive from flak. Martin has been invisible. He’s very cerebral but that’s not what is needed in a situation like this.”
Simon Francis, the coordinator of the End Fuel Poverty Coalition, said: “It would be good to see someone representing the consumer sitting on the Ofgem board. There are lots of people who will have experienced the sharp end of the energy crisis who would make excellent additions and present a different view in the boardroom.”
