Ofgem – who are they and what do they do?
Ofgem stands for the Office of Gas and Electricity Markets and it is the government department given the task of regulating the gas and electricity markets.
Ofgem’s key concerns and priorities therefore involve protecting consumers by ensuring that they are not being taken advantage of by energy suppliers. It will also attempt to ensure that a certain amount of the profits made by the energy companies will pay for the safe supply of energy and that greenhouse gases are reduced as much as possible.
Problems Ofgem faces
One particular problem that Ofgem faces is its lack of power to change the behaviour of certain energy companies. Whilst Ofgem can publish figures suggesting whether they believe the public are being ripped off by any price rises and assert that people should shop around between energy companies in order to create more competition over pricing, they actually have very little power in terms of forcing energy companies to do anything. Whilst energy companies have been forced through several acts of Parliament to offer cheaper energy to certain vulnerable sectors of society (though this is usually highly subsidised) by the Government, it does not actually have the power to fix prices and therefore there have been many accusations that its powers are far too limited.
Following much criticism, Ofgem has chosen to use the tactic of publishing what it believes the costs are to the energy companies and therefore the profits that they are making. This tactic is used as they continue to try to encourage people to be aware of their options in switching energy suppliers in a bid to increase competition. Although many of the companies have to release their profit figures, as they are listed companies, there is often much debate about the true costs that the suppliers have had to encounter and this is where Ofgem is supposed to provide an impartial view to the general public.
Making a complaint
If you have a complaint about your gas or electricity supplier you should try to resolve the matter with the company in question first. All suppliers should have their own internal complaints procedures which may well be able to deal with your concerns and compensate you for any loss you may have suffered. It is particularly beneficial to try to complain internally before you attempt to contact an external organisation nowadays, as the freedom to switch gas and electricity suppliers has increased certainly in terms of awareness; companies are therefore more prepared to deal with your complaints in order to try to stop you switching supplier and thus losing your business.
Another reason to ensure your complaint is dealt with internally before you look to complain to an external organisation is the fact that the Energy Ombudsman, who will look at your complaint if it has not been dealt with successfully by the company concerned, will not help you unless you have attempted to deal with the company first. It is worth noting that you should not complain directly to Ofgem, who deal with how the market is actually regulated rather than specific instances between the company and the consumer.