Monday 17 February 2014

Yee-ha! The sheriff’s new crackdown on bad brokers begins

Yee-ha! The sheriff’s new crackdown on bad brokers begins

A lone rattlesnake shakes its tail. The tumbleweed blows. Frightened shopkeepers huddle behind closed shutters. At the saloon bar, push doors swing open: the energy brokers are in town.

For years it’s been a wild, Wild West out in the energy market when it comes to brokers and TPIs - that’s third party intermediaries, don’t y’all know?

With little or no regulation, their numbers have swelled to around 1,000 at the latest count.

Some of these go-betweens for energy users and suppliers have respectably set up shop, nestled in next to the barber and the saddlery.

But other brokers have ranged on the outskirts, preying on smaller businesses who don’t know their way around energy charges – and making a fast buck on their ignorance.

These cowboys have long needed reining in – and finally Ofgem has offered up a code of practice for the sector. Energy suppliers won’t be able to do deals with anyone who isn’t a member.

The message from the sheriff is clear: get clean, or get out of town.

This is exactly the sort of thing we've been banging on about at ELN, especially with The Energy Live Consultancy Awards - aka theTELCAs - our special awards for good brokers and consultants. (If you've not entered, hop to it sharpish, before the deadline.)

So how well will the brokers take to Ofgem's new lasso? We won’t know for sure until more details are sketched out.

As many questions as answers are thrown up by the plans. How will the new body ruling the code - which has the power to throw out a broker – work?

Will the half a dozen or so brokers and a few more TPIs (including price comparison websites) face more or less competition?

And the new code isn’t the first – there are several others, including the Utilities Intermediary Association’s and more recently E.ON’s code. Are they now defunct? You can bet they won’t give up their ground easily.

One thing’s for sure, a more watchful eye on the shadier operators is definitely welcome.

Ofgem will be hoping we’ll rest safe in our beds at night, knowing we’ll have no more of them there bandits riding into the sunset, wads of cash tucked into their saddlebags.

Written by

Bruna Pinhoni

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