Ofgem proposes reforms for greater transparency from energy suppliers

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Industry regulator Ofgem has made a number of proposals that could, if implemented, see the way in which energy suppliers publish financial information made more transparent, according to an article published by Stock Market Wire.

The proposals follow an independent review by BDO LLP and form part of a larger effort to make the information given to consumers much easier to understand.

Ofgem's proposal would, according to Stock Market Wire, entail:

  • "Standardising how the companies account for generation accounting fuel costs to improve the comparability of the information they provide."

  • "Ensuring that companies are using the same accounting standards and methodologies when producing their profit measures."

  • "Proposing a checklist of functions to increase transparency on which ones are reported in the information."

Speaking about the proposals, Ofgem CEO Alistair Buchanan, stated: "Energy has got to become more open and transparent and our reforms will make suppliers' financial information much clear. The fact that independent accountants BDO have found suppliers' financial information to be fair and appropriate should also give consumers a degree of reassurance.

"Suppliers now need to build on this report and make the radical changes needed to restore consumer trust in energy suppliers. The real win for consumers will be when suppliers provide consumers with simple tariffs and clearer bills and annual statements as proposed by Ofgem."

Buchanan concluded: "There are clear signs that some suppliers are alive to this challenge and we are looking for full engagement by all supplier with our reform package."

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