Ofgem has given the industry notice to end practices that are failing some customers, and to deliver the full benefits of competition to the entire market.

In its findings from a seven-month probe into the energy supply market, Ofgem was particularly concerned to see behaviour by supply companies that was hitting the 4.3 million customers without a gas supply, who have no access to the most competitive offers.

At the same time, the regulator has shown that competition is generating a wide range of tariffs and products. There is strong consumer awareness of - and satisfaction with - switching. And Ofgem found no evidence of an energy supply market cartel.

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Ofgem's report builds on the regulator's commitment to help vulnerable customers through initiatives such as the Fuel Poverty Action Programme and Ofgem's Consumer First programme.

Ofgem's probe uncovered concerns in the small business supply market over unfairness in contract terms. The regulator's proposed actions include specific measures to guard against sharp practice in this part of the market.

Proposed actions in the wholesale market

Ofgem Chief Executive Alistair Buchanan said: "These are hard times and we are taking a hard line on behalf of disadvantaged consumers. We accept that global influences are pushing up costs but the suppliers must change their behaviour and cement consumer confidence. If they fail to satisfy our requirements voluntarily then we can move to a Competition Commission reference.

"Initial findings from our energy market probe give us grounds to demand that companies end practices that hinder customers, especially the vulnerable, from getting the best deal. But we have found no evidence of a cartel."

The report marks the start of a consultation on Ofgem’s findings and proposals that closes on 1 December.

(CD/JM)