Ofgem has launched a consultation on the preparatory steps for energy suppliers to design and test the data matching arrangements for extending the default tariff cap for vulnerable customers.
The UK Government is currently passing a Bill through Parliament requiring the regulator to implement a cap for all customers on standard variable tariffs (SVTs) and other default tariffs that customers are moved to at the end of a fixed-term deal.
Ofgem aims to introduce it by the end of the year, however, it is working on an alternative targeted form for vulnerable customers that can be introduced without the new duties and powers contained in the Bill if the Royal Assent for the default tariff cap is delayed.
Following its previous consultation, the regulator concluded it is “feasible and proportionate” for both Warm Home Discount obligated suppliers and other medium-sized firms – those with more than 50,000 customers and have been active in the market for at least three years by winter 2018/19 – to undertake data matching, if required for a form of price protection.
It is also proposing that smaller suppliers manually process requests from their customers claiming eligibility for extended price protection at the same time as large and medium suppliers are identifying them using the data matching exercise.
Its report states: “Price protection for the most vulnerable consumers is required after the default tariff cap ends. The preparatory steps we propose suppliers take now will enable a better understanding of any data matching process for any future vulnerable safeguard tariff. More broadly, the lessons learnt from this exercise will be valuable for future similar pieces of work aimed at protecting vulnerable consumers.”
The consultation will run until 31st May 2018.