Ofgem – Proposed Regulations for non-domestic Third Party Intermediaries (TPIs)

Ofgem – Proposed Regulations for non-domestic Third Party Intermediaries (TPIs)

What is this all about?

Everyone has most probably heard of examples of energy contract mis-selling by energy suppliers.  The headline stories often relate to domestic consumers.  However, what about the business sector, where many energy supply contracts are handled by intermediaries such as brokers and consultants?

As part of their Retail Market Review (RMR), Ofgem have a stated ambition to ensure that non-domestic customers are safeguarded from rogue energy intermediaries.  They have recently put forward proposals to regulate this sector which means that any organisation that non-domestic consumers rely upon for information and advice, referred to as a TPI, will have to sign up to an industry regulated code of practice.  Energy suppliers will only be able to work with TPIs who are accredited to this independently governed code.

What is the timetable for implementation?

So, this might sound like good news.  Choose an accredited TPI to help you negotiate your energy contracts and all will be well.  However, as with all such proposals, the devil will be in the detail.  Much work is still to be done.  Between now and next summer, Ofgem will be working with industry representatives to finalise some basic issues like – which types of organisation should be classed as TPIs?  What TPI activities fall within the scope of the code of practice?  How should the code be implemented and monitored etc?  Their intention is for full proposals to go live in the autumn/ winter of 2015.

What is Smith Bellerby doing to influence these deliberations?

As members of the Association of Cost Management Consultants (ACMC), we are represented on the stakeholder group which has worked with Ofgem to develop the proposals this far and which will continue to meet over the next few months to finalise the detail.  As Smith Bellerby, we have attended Ofgem conferences on the subject to put forward our views and also responded vociferously to Ofgem’s formal consultations.  Click here to see our responses.

We have some concerns about the role of energy suppliers in Ofgem’s proposals, preferring to maintain our complete independence.  However, whatever the final shape of the regulations, we will embrace them fully.  Anything which helps to drive up TPI standards and puts our clients’ interests first, wins our vote! Period…….