The Energy Secretary, Ed Miliband, set out plans on 21 April 2026 to reform the energy regulator Ofgem, with the government publishing the detail on 22 April. The Department for Energy Security and Net Zero said the changes are the first major update to Ofgem's scope since the regulator was founded in 20001.
Under the reforms, Ofgem would gain stronger powers to enforce consumer law directly, meaning it would no longer need to go through a lengthy courts process to make sure customers get what they are owed if companies treat them unfairly. The government also set out powers for Ofgem to ban energy executives' bonuses if they break the rules, and reforms to the regulator's remit to focus on economic and consumer protection, including the ability to regulate in new areas of the market if needed1.
The government said the market has grown more complex since Ofgem was established, with growing numbers of customers in parts of the market covered by little, if any, regulation. It named heating oil customers, who have seen prices spike following the start of the ongoing conflict in the Middle East, and pointed to funding worth over £50 million announced last month to support low-income families reliant on heating oil, alongside a commitment to introduce new consumer protections to that sector1.
"Great Britain's energy system is going through the biggest changes in our lifetimes, and the regulator needs to be able to keep pace with that change. This review sets out ambitious, necessary reforms that will enable Ofgem to meet the challenges of regulating an increasingly electrified and flexible energy system and protect consumers so they can engage confidently in markets offering new products and services."
As part of the shift, Ofgem's responsibility for oversight of home upgrade schemes is to be removed, with that role set to be performed within government by the Warm Homes Agency. The government said Ofgem's technical expertise will be strengthened, its use of data improved and its approach to risk reassessed, enabling faster decisions in the interests of consumers, supported by a workforce plan and stronger board-level oversight of skills and culture1.
| Change | Detail |
|---|---|
| Consumer law enforcement | Ofgem to enforce directly, without a lengthy courts process |
| Executive bonuses | Powers to ban bonuses if rules are broken |
| Remit | Refocused on economic and consumer protection; ability to regulate new market areas |
| Home upgrade schemes | Oversight removed from Ofgem; role to sit within government at the Warm Homes Agency |
The government also cited earlier measures: action taken at the Budget at the start of April saw the price cap fall by 7%, supporting households with lower bills until the end of June, and Ofgem is reviewing the supplier Guaranteed Standards of Performance, which set minimum standards all suppliers must meet for specific services or pay £40 automatic compensation if they fail to do so1.
Why it matters for households
The reforms bear on how quickly and how directly a household can get redress when a supplier fails. Direct enforcement of consumer law removes a court step the government describes as lengthy, which is the mechanism by which money owed to customers is recovered. The bonus powers give the regulator a lever over executive conduct rather than over the tariff a household pays.
The remit change matters for homes outside the standard domestic supply market. The government singled out heating oil customers as a group that has seen prices spike and that sits in a part of the market covered by little, if any, regulation, and said new consumer protections for that sector are still to come. For homes on the energy price cap, the 7% fall cited applies until the end of June; the reforms themselves do not set the cap.
Moving home upgrade scheme oversight to the Warm Homes Agency separates support for physical improvements to a property from the economic regulation of suppliers. What that means in practice for households applying to such schemes has not been reported. The role of the regulator and the department behind the policy are set out in the site's guides to DESNZ and to UK home energy regulation and policy.
What happens next
The government has not set out a timetable for legislating or implementing the reforms, and no commencement dates have been reported. Ofgem's review of the supplier Guaranteed Standards of Performance is under way, and the government's proposals on fairer, quicker and easier access to compensation, announced last year, remain proposals. The £50 million in heating oil support and the commitment to new consumer protections for that sector were announced last month; the detail of those protections has not been reported.