Energy executives in the United Kingdom face stricter regulations under a new crackdown on mis-selling, with their bonuses subject to curtailment when suppliers or brokers violate rules. The government plans to introduce the Energy Independence Bill this Wednesday, which will empower the regulator Ofgem to order compensation, impose fines, and ban operators found pushing businesses and households into inflated energy contracts.
Currently, many companies rely on brokers to secure business energy supply deals, yet these intermediaries remain largely unregulated compared to those in the mortgage or insurance sectors. Officials state that rogue brokers have exploited this gap by steering small businesses toward overpriced agreements while pocketing hidden commissions. By bringing these brokers and price comparison services under Ofgem's remit, the government expects to save businesses more than £100 million annually from these hidden costs and mis-selling practices.
The legislation also addresses public outrage regarding executive compensation, specifically targeting payments to bosses who have "rewarded themselves while customers suffer." Energy Secretary Miatta Fahnbulleh emphasized that consumers should not be forced to fight for fair treatment or see executives walk away with large bonuses while families and businesses bear the financial burden of corporate failures.
Beyond consumer protection, the bill outlines broader energy policies, including stronger powers for local authorities to fine landlords up to £30,000 for failing to meet energy efficiency standards. It also introduces a moratorium on fracking by ending new onshore licensing in England. While the ban excludes lower-volume operations and "proppant squeeze," critics like Tony Bosworth of Friends of the Earth argue this allows the industry to operate under different names. Conversely, experts such as Professor Stuart Haszeldine warn that low-volume fracking can still cause unpredictable earthquakes similar to high-volume operations.
The announcement comes amidst political scrutiny over the government's green agenda, following recent budget cuts to the energy department and warnings from the chancellor regarding offshore wind projects. Despite these challenges, ministers maintain their commitment to achieving clean power targets by 2030.
Sources: The Guardian Business.