Responding to the announcement from Ofgem this morning that it is launching a consultation on the future of the price cap, Simon Virley CB, Vice Chair and Head of Energy and Natural Resources at KPMG UK, said:
“The price cap was introduced five years ago as a temporary measure to protect ‘sticky' customers, while the energy market was reformed. In the intervening years the price cap has worked in saving customers money, especially in recent years where we have seen unprecedented price rises. However, our recent research has shown that this has come at a price, with effective competition and innovation in the market suffering and switching levels falling off a cliff.
“As we look to what a future retail energy market looks like – it will be key to balance proportionate consumer protection with incentives for investment and innovation in a smarter energy system that benefits all consumers.”
