London Daily

Focus on the big picture.
Saturday, Mar 14, 2026

Energy regulator Ofgem says gas crisis not its fault

Energy regulator Ofgem says gas crisis not its fault

The boss of the regulator tells the BBC no-one could have predicted the sharp rise in gas prices.
The head of Ofgem has rejected claims from the industry the current energy crisis represents a failure to adequately regulate the market.

Six suppliers have gone bust recently, leaving about 1.5 million customers facing higher bills, with more firms expected to fold.

Ofgem boss Jonathan Brearley, told the BBC: "No-one could have predicted the kind of gas price rises we have seen.

"In a situation like that any market would be under strain."

Gas prices are up four-fold, Mr Brearley said.

However, his view has little support from senior executives in the industry who have told the BBC the regulator knew full well that many smaller suppliers would not be resilient in the face of rises that should have been part of the regulator's stress testing of the sector.

The boss of the UK's fifth largest energy provider, Scottish Power, said the government was essentially asking larger providers to weaken their own financial position by shouldering billions in additional cost to provide these customers with energy that costs more to buy than they are allowed to sell it for under a government-imposed retail price cap.

Ofgem insists its primary concern has been protecting consumers, but that promise sounds slightly hollow when millions of customers face being moved to higher tariffs from bigger suppliers and the cost those larger companies incur from taking on new customers will be added to all consumers bills through an industry wide levy.

Larger suppliers, including Centrica owned-British Gas, have agreed to take on hundreds of thousands of marooned customers, but expect the cost of doing so to be recouped in a mechanism that Ofgem described as "tried and tested" but which bigger companies say is not designed for the mass failures we are now seeing.

The Ofgem boss admits that the energy cap (£1,277 for a dual fuel household with average energy consumption) which limits the ability of companies to pass on higher wholesale costs to retail customers, is likely to rise again when it is reset in April 2022 after a 12% rise due to take effect at the end of this month.

Industry sources also agree that many of the larger companies may be prepared to take on new customers not only because the retail price cap will inevitably rise, but also because the new customers they acquire will be "stickier". This means they will be less likely to switch in future given a lack of confidence that cheaper suppliers can be relied upon in the future,

The received wisdom and advice of the last ten years to continually switch suppliers now looks less persuasive.

Ofgem's Mr Brearley insists he wants a competitive market in the future. Critics argue that it presided over a market that it knew would collapse in a gas crunch - resulting in fewer companies and meaning a less competitive market.
Newsletter

Related Articles

0:00
0:00
Close
Middle East War Highlights Strategic Importance of Strong UK–Ireland Cooperation
Weak Growth Signals UK Economy Was Faltering Even Before Middle East Energy Shock
Marks & Spencer Tops UK Fashion Retail Rankings as Most Considered Brand
United States Launches Trade Investigation Into Allies Over Forced Labour Practices
United States Launches Trade Investigation Into Allies Over Forced Labour Practices
Russia Accuses Britain Over Storm Shadow Strike as London Reaffirms Ukraine’s Right to Self-Defence
Russia Accuses Britain Over Storm Shadow Strike as London Reaffirms Ukraine’s Right to Self-Defence
Royal Navy to Acquire Twenty Uncrewed Surface Vessels for Autonomous Warfare Testing
Russia Summons British and French Envoys After Ukrainian Storm Shadow Strike on Strategic Facility
Starmer Confirms Britain Will Maintain Sanctions on Russia Despite U.S. Policy Shift
UK Moves to Refine AI Definition in Investment Security Reform
UK Economy Stalls in January as Growth Unexpectedly Falls to Zero
Asian Energy Security Tested as Strait of Hormuz Disruption Threatens Oil Supplies
Iran Sets Three Conditions for Ending Regional War as Diplomatic Efforts Intensify
Tesla Secures Approval to Supply Electricity Directly to Homes Across Britain
Prince William Delivers Tribute to Australia’s Naval Alliance Amid Renewed Royal Spotlight on the Country
UK Foreign Secretary Travels to Saudi Arabia to Reinforce Support for Regional Allies
Putin’s ‘Hidden Hand’ May Be Assisting Iran in Conflict With Trump, UK Defence Secretary Warns
UK Sets April Deadline for Tech Platforms to Strengthen Online Protections for Children
Elon Musk Moves Into Britain’s Energy Market as Tesla Wins Licence to Supply Power
UK Watchdog Warns Fuel Retailers Against Profiteering Amid Iran War Price Surge
Report Claims Iran Used UK Charity Network to Expand Influence
United States and United Kingdom Establish Joint Standards for Counter-Drone Technology
Iran May Be Laying Naval Mines in Strait of Hormuz, UK Warns Amid Escalating Gulf Tensions
US Deploys Bunker-Buster Bombs to UK Airbase as Iran Conflict Intensifies
British Troops in Iraq Intercept Iranian Drones Targeting Coalition Base
Release of Mandelson Files Raises Tensions as UK Seeks Stable Relations With Donald Trump
UK Documents Reveal Starmer Was Warned About Mandelson’s Epstein Links Before Ambassador Appointment
Nearly Five Hundred UK Mortgage Deals Withdrawn in Two Days as Market Volatility Forces Lenders to Reprice
Three Cargo Ships Hit Near Iran as Attacks Spread to Strategic Strait of Hormuz
Why British Police Repeatedly Declined to Investigate Jeffrey Epstein’s UK Links
UK Parliament Ends Hereditary Seats in House of Lords, Closing Chapter on Centuries of Aristocratic Lawmaking
EU and UK Urge Israel to Act Against Rising West Bank Settler Violence Amid Regional Tensions
US Senator John Kennedy Says Keir Starmer Should Not Be Trusted for Military Advice Amid Iran War Debate
UK High Court Rejects Attempt to Revive Terrorism Charge Against Kneecap Rapper
Revolut Secures Full UK Banking Licence After Multi-Year Regulatory Wait
Kentucky’s Bench Boost Powers Wildcats Past LSU in SEC Tournament Opener
British Couple Die After Being Pulled From Water at Australian Beach During Family Visit
Global Energy Agency Announces Record Release of 400 Million Barrels to Stabilize Oil Markets Amid Hormuz Disruption
British Airways Suspends UK Repatriation Flights as Middle East Travel Disruption Deepens
US Forces Prepare Ordnance at RAF Fairford as Strategic Bombers Deploy for Middle East Operations
Nigel Farage Faces Criticism After Saying Britain Should Stay Out of Iran War
Landmark UK Trial Begins Over Sony’s PlayStation Store Pricing
UK High Court Rejects Bid to Challenge Britain’s Chagos Islands Agreement With Mauritius
Finnish Duo Triumphs in England’s Annual Wife-Carrying Race, Winning a Barrel of Ale
How U.S. and UK National Security Strategies Are Reshaping the Global Business Landscape
Green Party Gains Momentum as Labour Shifts Toward the Political Centre
Royal Navy Destroyer HMS Dragon Sets Sail for Eastern Mediterranean as Regional Tensions Rise
UK Homebuilder Persimmon Warns Iran Conflict Could Dent Property Buyer Confidence
Roman Abramovich Signals Legal Fight if UK Seeks to Seize Chelsea Sale Funds
×