Will the Cabinet Secretary confirm if the Welsh Government submitted a formal response to the recent Ofgem consultation on standing charges, and what was included within the response?
My officials submitted a response to Ofgem’s consultation on introducing a zero standing charge energy price cap variant. Welsh Government has advocated for standing charges reform to sit as part of a package, to ensure we have a balanced system which protects vulnerable and low-income households, including a social tariff.
We welcome the introduction of low and no standing charges in the market but recognise switching supplier is not an option for all customers particularly those in debt. We would like to see all suppliers offering tariffs with low and no standing charges. Some households who may benefit from such a tariff the most, may not be aware such tariffs exist. Disengagement amongst vulnerable householders is an issue, and we believe it is important for suppliers to better advise their consumers which tariff is more appropriate for them or move them onto such a tariff automatically.
Although we welcome Ofgem consulting on introducing a zero standing charge energy price cap variant, we do not believe having such a price cap will necessarily help vulnerable low-income householders, particularly those who are disengaged. Householders will need to opt in to the new proposed price cap variant and this will not help low-income and disengaged householders who could potentially benefit from such a variant the most.