Christine Farnish stated that she quit because she did not believe the regulator “hit the correct balance.” Let’s see Why did the Ofgem director quit.
Why did the Ofgem director quit
Christine Farnish told The Times that the regulator had not “found the correct balance between consumer and supplier interests.”
Every three months, Ofgem is in charge of determining the level at which home energy bills are capped.
Ms Farnish was commended by the watchdog for “her many years of diligent work.”
What Ms. Farnish told?
Ms Farnish told the Times that she disagreed with a decision to modify the cap to allow suppliers to recoup certain wholesale costs sooner – a policy the regulator claims will prevent more suppliers from going bankrupt.
What Ofgem spokesperson said?
“Due to this unprecedented energy crisis, Ofgem is having to make some really tough decisions where carefully balanced trade-offs are being weighed up all the time,” an Ofgem spokesperson said.
“However, we consistently prioritise the demands of our customers, both in the short and long term.”
The regulator has come under fire for lifting the energy price limit – the maximum amount suppliers in England, Scotland, and Wales can charge domestic customers for per unit of energy – in October.
Is any other accusation in Ofgem?
The cap is intended to safeguard consumers from short-term price fluctuations and is modified every three months by Ofgem depending on the amount energy suppliers pay producers for electricity and gas.
Martin Lewis, a consumer rights activist, has previously accused the regulator of “selling people down the river.”
The price cap for October is set to be revealed at the end of this month.
What was the average annual cost?
Cornwall Insight, an energy market expert, predicts that the average annual cost will be £3,582 at this time, which is £200 higher than the prior estimate.
Cornwall Insights anticipates that the maximum will be raised to £4,266 in January 2023, when it is set to be revised again.
The larger estimate implies that the average household would spend £355 per month, up from £164 presently.
Why the Energy cost has been raised?
Energy costs have risen substantially as demand for gas soared following the relaxation of Covid limitations, and as Russia’s supply have been endangered by the invasion of Ukraine.
Ofgem recently altered the rules so that the cap can be revised every three months rather than every six months, claiming that this would reduce the likelihood of more energy companies collapsing and allow consumers to benefit from any future price drops sooner.
Is energy supplier failed in the UK?
In the last year, twenty-nine energy suppliers have failed in the United Kingdom.
In response to Ms Farnish’s departure, an Ofgem spokeswoman stated that the remaining board members had determined that a shorter recovery period for energy bills was in “the best interests” of customers in the “long run.”
The modification, according to the spokesman, minimised the “very real potential of suppliers going bankrupt, which would dump even more costs onto bills and bring needless stress and concern at an already difficult time.”
What Ofgem said?
“We are aware of a resignation at the Board of Ofgem, which has been accepted,” a representative for the government’s business department said.
Further comment from Ms. Farnish was rejected.
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