The Department for Energy Security and Net Zero published its response to the Competition and Markets Authority (CMA) market study into the retail supply of heating oil for domestic use on 13 October 20261. The government confirmed it will accept the CMA's recommendation to strengthen regulation in the heating oil sector, with the aim of formalising the standards consumers should expect from suppliers, protecting vulnerable households and giving clearer routes to compensation2.
The CMA published its final report on 15 July 20261. It later found that 1,700 households were owed compensation after they were forced to re-order heating oil at higher prices when suppliers cancelled their orders2. The government said it stepped in with £53 million in immediate support to help vulnerable heating oil customers through the crisis2.
Minister for Energy Consumers Polly Billington said:
"Thousands of heating oil customers felt they had nowhere to turn when they paid the price of rising oil and gas costs earlier this year. We won't accept that. Energy is an essential good and people should not have to think twice about whether they're protected in the market."
The government said households will be better supported in the short term through strengthened consumer protections in Codes of Conduct, and that industry practices setting minimum order volumes at 500 litres for some consumers will be reviewed2. It also said heating oil customers are eligible for extra support to move to a heat pump, after the discount was increased to £9,000 for households who use heating oil2. July's application figures marked an 81% jump compared to the previous year, and 1,042 voucher redemptions paid in August were for the £9,000 heating oil grant, representing 32% of the total for the month2.
The Belfast Telegraph reported that the market is to be better regulated under plans to ensure households using the fuel are treated fairly3.
Why it matters for households
Heating oil is used by households that are not connected to the gas grid, many of them rural. The measures set out here concern the retail supply of that fuel, including the terms suppliers set and the routes open to customers when something goes wrong. The review of minimum order volumes at 500 litres addresses a practice that requires some consumers to pay for more heating oil than they may need2. The £9,000 heat pump discount and the application figures indicate the scale of interest in moving away from oil, though the sources do not report how many heating oil households have switched. Details of the Heating Oil and LPG Supply in the UK market are set out separately.
What happens next
The government said it will now work with industry to develop a regulatory regime for the heating oil market, protecting consumers and promoting competition2. It said industry practices on minimum order volumes will be reviewed2. No timetable for the regulatory regime has been reported.