Call for customer ban
British Gas owner Centrica has called on energy watchdog Ofgem to ban suppliers like Octopus Energy from taking on new customers if they fail to meet strict new capital requirements.
Centrica boss Chris O’Shea slammed Ofgem’s handling of the issue as “criminal” and accused the regulator of risking another market collapse by allowing undercapitalised companies to keep trading.
He said: “We can’t risk a repeat of what happened during the energy crisis when we saw half of the market disappear through poor regulation from Ofgem.”
Regulator under fire
New financial rules introduced in March require firms to hold at least £115 in net adjusted assets per dual-fuel customer or have a credible plan to get there. Ofgem says 20 out of 23 suppliers now meet the target, while three, including Octopus, have an approved plan in place.
But O’Shea argued that firms not already meeting the capital bar should be barred from signing up more customers until they do. “If you’ve got big suppliers in the market that don’t have adequate capital…you’ve got to ask what the regulator’s doing,” he said.
Octopus hits back
Octopus Energy, now the UK’s biggest energy supplier, hit back, accusing Centrica of “naked self-interest.”
A spokesperson said: “We fully comply with Ofgem’s rules and our resilience meant we not only thrived through the energy crisis but bailed out Bulb.”
Ofgem defends system
Ofgem said the sector’s financial position had “improved significantly” since the energy crisis, with suppliers now holding £7.5 billion in net assets.
The regulator defended its flexible approach, stating: “Where a supplier is not meeting the capital target but has a credible and agreed plan in place, that is not a breach of the rules.”
Centrica’s comments came as it presented its interim results.
O’Shea warned: “The cost of failure goes on to consumer bills – all suppliers should be held to the same standards of resilience.”
