Energy regulator Ofgem has proposed an overhaul of the governance of gas and electricity industry codes.

The codes set the rules for industry players to participate in the market and connect to the energy networks. The proposed reforms aim to speed up the process for making changes to codes and to strengthen competition and new entry by making it easier for smaller players, such as smaller suppliers and renewable generators, to participate and propose changes.

Under current arrangements, major code changes, such as the current electricity transmission access reforms, frequently hit delays. The reasons for this often include multiple proposals being raised on an uncoordinated basis. Progress can also be hindered by the conflicting interests of different players in the market. Pro-competitive reforms can be stalled, with impacts on smaller market players.


Alistair Buchanan, Ofgem Chief Executive, said: "Existing processes for amending the codes have worked well to implement incremental change but have been severely tested in delivering major policy reforms. Ofgem's review of the market and network codes should help accelerate vital reforms so the industry can rise swiftly to challenges emerging from the need to tackle climate change and to boost competition. The review proposals aim to tackle unnecessary complexity and increase transparency to make it easier for smaller suppliers and renewable generators to participate."

Under the proposed new approach, Ofgem could initiate changes on major policy issues while in parallel, more routine changes, with low impact on customers, could be agreed by industry in a form of self-governance with little or no involvement from Ofgem.

(CD/JM)