The Department for Energy Security and Net Zero launched a review of Ofgem, the gas and electricity markets regulator for Great Britain, in December 2024, opening a public call for evidence. The department describes it as "the first comprehensive review in Ofgem's 25-year history"1. The review examined whether the regulator's structure, statutory duties and organisational culture remain fit for purpose1.
Ofgem was established in 2000 to support and deliver the functions of the Gas and Electricity Markets Authority, created by the Utilities Act 2000. Its original principal objective was "to protect the interests of consumers [...] wherever appropriate by promoting effective competition"1. The review states that Ofgem's current structure, tools and capabilities "are no longer sufficient for a more complex and fast-changing energy system", and that it needs clearer responsibilities, stronger enforcement and enhanced organisational capability1.
The review set out seven core objectives, covering regulatory boundaries, Ofgem's mandate and duties, consumer protection and service standards, regulatory powers, skills and capability, support for economic growth and net zero, and transparency and scrutiny1. It identified six strategic outcomes for a reformed regulator, including a clearly defined remit, an empowered regulator that protects and promotes consumer interests, and a regulator that enables innovation, investment, growth and the clean energy transition1.
Stakeholder responses described confusion and duplication across Ofgem, the department and the National Energy System Operator, with suppliers citing overlapping duties and reactive regulation, consumer groups raising concerns about weak enforcement and limited redress, and other firms pointing to high staff turnover and gaps in digital and financial expertise1. Some respondents described a risk-averse, process-heavy culture that can slow decision-making1.
The review states that a new set of three equal principal objectives will be introduced, "focusing on the interests of existing and future consumers, net zero and growth"1. It also notes that Ofgem's role in supporting growth was recognised through the addition of a growth duty in 2024, and that the introduction of the price cap in 2019 "was a significant intervention in the market"1.
"In December 2024 we kicked off the first comprehensive review in Ofgem's 25-year history"
The review also records that Ofgem introduced stringent new rules for the installation of prepayment meters in 20231. The department says the reforms are intended to sharpen the division of responsibilities between government and the regulator, with government setting strategic outcomes through a reformed, Ofgem-specific Strategy and Policy Statement and Ofgem determining how to deliver within its remit1.
Why it matters for households
Ofgem sets the licence conditions that energy suppliers, network operators and generators must meet, monitors compliance and takes enforcement action when they are not met1. It also manages the energy industry codes that govern how companies interact with the grid and how consumers are switched between suppliers1. Changes to the regulator's duties and enforcement powers therefore bear directly on how household complaints, billing disputes and supplier failures are handled. The review's stated aim of strengthening enforcement and redress, and of giving the regulator new powers to enforce consumer law directly without going through the courts, concerns the route a household has when something goes wrong. The Ofgem guide sets out what the regulator covers, and the complaints and redress guide explains the ombudsman and Citizens Advice routes. The department responsible for the review is covered in the DESNZ guide.
What happens next
The review's final report has been published, with a full table of actions at Annex B1. The department states it will work with Ofgem, industry and others to implement the reforms, and that the department and Ofgem will work with the National Energy System Operator and stakeholders to clarify roles across the three organisations1. No timetable for individual measures is given in the published material.