Quicker complaints, fairer payouts: new rules to protect energy customers

Energy customers are set to receive stronger protection against poor service, with new reforms that will speed up complaints and ensure fairer compensation when things go wrong.

The Government has announced changes that will halve the time it takes to escalate complaints and require suppliers to pay compensation if they fail to implement ombudsman rulings.

The waiting period before customers can take a complaint to the Energy Ombudsman will be cut from eight weeks to four, while the ombudsman’s own target resolution time will fall from six weeks to four.

Suppliers will also face financial penalties if they don’t act promptly on ombudsman decisions – tackling a major enforcement gap. Currently, almost 10% of ombudsman rulings are implemented late or not at all, meaning thousands of customers miss out on compensation they’re owed.

Energy Secretary Ed Miliband said:

“For too long, parts of the energy market have been letting consumers down and not paying up when mistakes are made. Our reforms will put this right – making it faster and easier for families and small businesses alike to benefit from money back when things go wrong.”

The reform package also includes a crackdown on “cowboy” energy brokers who use unfair sales tactics to sell overpriced business contracts, and new protections for smart meter installations that could deliver up to £200 million in savings.

Read our guide to understand when you’re entitled to get money back and compensation from your energy supplier.

What the new protections mean for you

At present, customers must wait eight weeks after raising a complaint before escalating it to the independent Energy Ombudsman. Once there, cases take around six more weeks to resolve – meaning customers can wait up to 14 weeks in total.

Under the new rules, the initial waiting period drops to four weeks and the ombudsman’s target resolution time falls to four weeks, potentially cutting the full process to just eight weeks.

The bigger issue, though, is enforcement. Around one in ten ombudsman rulings aren’t properly implemented. When the ombudsman awards compensation, some suppliers delay or fail to pay altogether. The new penalties will create a clear financial incentive for suppliers to comply.

How the energy reforms affect your rights right now

The ombudsman reforms will benefit all household and business customers with unresolved energy complaints. But you don’t need to wait for these reforms to claim compensation.

Under Ofgem’s Guaranteed Standards of Performance rules, suppliers must already pay £30 compensation when they fail to meet minimum service levels. These payments should be automatic – though many customers still need to chase them.

You’re entitled to £30 if your supplier:

• Doesn’t respond to your complaint within eight weeks (soon to be four under the reforms)
• Fails to send a final bill within six weeks of you switching supplier
• Doesn’t refund credit balances within ten days of issuing your final bill
• Misses a planned appointment at your property
• Fails to restore supply within specific timeframes
• Doesn’t switch you to a new supplier within five days of your request

These payments can stack up. For example, if your supplier misses an appointment, delays your final bill and fails to refund your credit, you’re owed £30 for each failure – £90 in total, paid automatically into your account or bank.

Read our full energy compensation guide for everything from how to report power cuts and claim compensation from your network operator to how to escalate complaints when suppliers don’t pay what they owe.

FAQs on what the energy reforms mean for you

Q: When do the new reforms take effect?

A: The Government hasn’t confirmed an implementation date. Major regulatory changes typically require a consultation period where industry and consumer groups can respond, followed by a transition period for suppliers to update their systems. It’s likely to be months rather than weeks before the changes come into force.

Q: Do I need to do anything to access the new protections?

A: No. Once implemented, the reforms will apply automatically to all energy customers. The shorter ombudsman waiting periods and enforcement penalties will become part of the standard complaints process. However, you should still keep records of complaints and know your rights to make sure you receive what you’re entitled to.

Q: What if my supplier has already failed to pay ombudsman compensation?

A: You should report this to Ofgem immediately. The ombudsman’s rulings are binding, and suppliers are required to implement them. The new reforms will strengthen enforcement, but non-compliance is already a breach of regulations that Ofgem can investigate and penalise.

Q: Are prepayment meter customers covered by these protections?

A: Yes, all domestic energy customers have the same rights to complain and receive compensation, regardless of payment method. However, prepayment customers face additional vulnerabilities around disconnection, so it’s particularly important to know your rights if you’re on a prepayment meter.

“Cowboy” energy brokers also targeted

The reforms extend beyond household complaints. Energy brokers – middlemen who help businesses negotiate energy contracts – have operated largely unregulated, allowing rogue operators to exploit customers. These brokers can use high-pressure sales tactics to push businesses into expensive contracts that earn the broker higher commissions.

Beth Martin, director for consumer protection and competition at Ofgem, said: “When any household or business is taken advantage of by a rogue energy broker, the reality is significant stress and financial strain that can have a real impact on their lives or the future of their company.”

The Government plans to bring brokers under Ofgem’s regulatory remit for the first time. The package also includes standardised contracts for businesses installing smart meters.