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Standards of conduct introduced for energy market

Energy tariffs will be simplified from 2014, Ofgem has announced.

Customers must be told the cheapest deal available from the end of March, and energy suppliers can offer no more than four tariffs for each type of fuel. Over the past three years, average bills have risen by 28% to £1,420 a year, Ofgem said.

The reforms aim to simplify pricing and make deals more transparent, while standards of conduct will stop companies misleading customers and to treat every customer fairly.

Ofgem's chief executive, Andrew Wright, said: “Suppliers have already taken some steps to make the energy market simpler for customers and we welcome that, but our package of reforms means they must go further. The standards of conduct we have introduced require suppliers to go through a culture change in the way they treat consumers.

“They have to make sure they are embedding simplicity, clarity and fairness into all their dealings with consumers to tackle the lack of trust that has blighted the market. The standards of conduct will also enhance consumer protection as they are backed by Ofgem's power to levy fines.”

Executive director of consumer group Which?, Richard Lloyd, said: “Improving the way suppliers deal with their customers is a step forward but Ofgem's reforms to fix the broken energy market do not go far enough.

“Rising energy bills are consistently one of the top worries for consumers so the Government must step in to ensure trust in suppliers is rebuilt and prices are kept in check. We want the Government to introduce simple pricing and to ringfence energy supply from generation businesses to increase confidence that there is effective competition in the energy market.”

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