Ofgem consults on reviving charge on suppliers that win customers when wholesale prices fall
Ofgem has opened a consultation on reintroducing the market stabilisation charge, under which suppliers gaining customers would compensate rivals if wholesale prices fall sharply. Ofgem says it protects suppliers; Martin Lewis says it is bad for consumers.
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The story, neutrally told
Mixed · 2Ofgem, the energy regulator for Great Britain, has published a consultation on reintroducing the market stabilisation charge (MSC), a mechanism meant to stop suppliers failing if customers leave in large numbers. The GuardianLC “Ofgem has published a consultation on a proposal to reintroduce the market stabilisation charge (MSC)” Read at The Guardian ↗ Evening StandardN “Britain’s energy watchdog has launched a consultation on plans to reintroduce a measure” Read at Evening Standard ↗ Mixed · 2The Guardian and the Evening Standard link the move to volatile wholesale prices tied to conflict in the Middle East; the Standard specifically cites the Iran war. The GuardianLC “sharp swings in energy prices linked to the conflict in the Middle East” Read at The Guardian ↗ Evening StandardN “as the Iran war continues to impact wholesale markets” Read at Evening Standard ↗ Mixed · 2Suppliers can be left exposed when they have bought energy in advance at a high price and wholesale prices then fall sharply, prompting many customers to switch to cheaper deals. Under the MSC, the supplier that gains a customer pays a charge to partly compensate the one that lost them. Evening StandardN “It works by ensuring the supplier which gains a customer through switching pays a charge to partially compensate the provider that lost the customer.” Read at Evening Standard ↗ The GuardianLC “suppliers that have bought energy in advance for customers on default tariffs can face losses if large numbers of customers switch to cheaper fixed deals” Read at The Guardian ↗
Left · 1According to the Guardian, the charge would be triggered if wholesale prices fall by more than 10%, with winning suppliers compensating rivals for 85% of the drop in wholesale rates. The GuardianLC “the MSC would be triggered if wholesale prices fall more than 10%.” Read at The Guardian ↗ Mixed · 2The charge was previously in force from April 2022 to March 2024, after Russia's invasion of Ukraine sent wholesale prices soaring; the Guardian says more than 30 energy companies went bust in that period. The GuardianLC “The charge was last activated between April 2022 and March 2024” Read at The Guardian ↗ Evening StandardN “The measure was previously put in place in April 2022 through to March 2024” Read at Evening Standard ↗ Mixed · 2Neil Kenward, Ofgem's interim director general of markets, said the regulator is preparing for "a difficult winter for many households" and that the MSC helps protect consumers from volatility and lets suppliers secure energy without taking unsustainable risks. The GuardianLC ““We’re preparing for what is likely to be a difficult winter for many households,” said Neil Kenward” Read at The Guardian ↗ Evening StandardN “it’s important that suppliers can continue to secure the energy their customers need without taking unsustainable risks.” Read at Evening Standard ↗
Mixed · 2Ofgem said reactivating the MSC would not automatically create charges or raise customer bills, since payments between suppliers would only occur if wholesale prices fell sharply enough. The consultation seeks views on trigger levels, notice periods and deactivation arrangements. Evening StandardN “payments between suppliers would only be made if wholesale prices fell sharply enough” Read at Evening Standard ↗ The GuardianLC “The consultation is seeking views on how the mechanism should operate, including trigger levels, notice periods and deactivation arrangements.” Read at The Guardian ↗ Left · 1Martin Lewis, founder of MoneySavingExpert, criticised the proposal, saying it "ain't good for consumers" and that if wholesale prices drop sharply, cheap fixes and switcher deals would become more expensive to protect energy firms' profits. He swore at Ofgem on a press call when the charge was activated in 2022, later apologising for his "emotional rant". The GuardianLC “it ain’t good for consumers and I don’t want it to slip under the radar.”“He later posted an apology for his “emotional rant” on the social media platform X.” Read at The Guardian ↗ Mixed · 2The context is rising bills: the price cap rose 4% from 1 October, the Guardian puts it at the equivalent of £1,723 a year for about 22m homes, and Cornwall Insight forecasts a further rise of about £149 in January, while the Standard cites forecasters warning of almost £300 more. The GuardianLC “About 22m homes are paying the equivalent of £1,723 a year for typical gas and electricity usage between October and December” Read at The Guardian ↗ Evening StandardN “Households were hit with a 4% hike to Ofgem’s energy price cap from October 1, with forecasters warning power bills could soar by almost another £300 from January.” Read at Evening Standard ↗
Left · 1The Guardian adds that the chancellor, John Healey, plans a major intervention to cut energy bills for poorer households in this month's budget. The GuardianLC “The chancellor, John Healey, is planning a major intervention to cut energy bills for poorer households in this month’s budget.” Read at The Guardian ↗
Every sentence links to the reporting it rests on. The pill in front of each says where its sources sit: Left, Centre or Right when one side supplies at least half of them, Mixed when they are evenly split. The number is how many outlets it cites.
Left1 outlet
- Framing
- Frames the proposal as a charge on suppliers that undercut rivals, then gives space to consumer-champion Martin Lewis's objection that it protects firms' profits at consumers' expense.
- Emphasis
- Mechanics (10% trigger, 85% compensation), Lewis's criticism and past clash, bill levels and the chancellor's planned help.
- Leaves out or plays down
- Does not stress the Iran war by name.
- Charged language
- “lure customers”“customer exodus”
- For example
-
“Energy suppliers could be forced to pay a charge to rivals if they lure customers with cheaper deals” — The Guardian
“In a nutshell, it means if wholesale energy prices drop sharply, the cheap fixes and switcher deals offered will be a lot more expensive, in order to protect energy firms’ profits.” — The Guardian
Centre1 outlet
- Framing
- Presents the move as a regulator cushioning suppliers from wholesale price swings amid the Iran war, relaying Ofgem's reassurances.
- Emphasis
- Ofgem's statement that no charges or bill rises are automatic, Kenward's quotes, and price-cap rises.
- Leaves out or plays down
- Omits the 10% trigger and 85% figure, the 30-plus supplier failures, and any criticism such as Martin Lewis's.
- Charged language
- “cushion”
- For example
-
“Ofgem said re-activating it would not automatically create charges or push up customer bills” — Evening Standard
“Ofgem planning action to cushion energy firms from wholesale price swings” — Evening Standard
Right0 outlets
No right outlet in our sources has covered this story yet.
What every side reports
- Ofgem has launched a consultation on reintroducing the market stabilisation charge.
- The charge was previously in place from April 2022 to March 2024.
- Ofgem says reactivation would not automatically create charges or raise bills.
- Neil Kenward, interim director general of markets, said Ofgem is preparing for a difficult winter.
Where accounts differ
-
Whether the charge benefits consumers
- Left
- Martin Lewis says it makes cheap fixes and switcher deals more expensive to protect energy firms' profits.
- Centre
- Reports Ofgem's view that it protects consumers from volatility and no bill rise is automatic; carries no critic.
Ofgem organisation
Says the MSC supports responsible energy purchasing and stability in a volatile market, and that reactivation would not automatically raise bills; seeks views on design.
“The MSC supports responsible energy purchasing and helps reduce the risk of instability in the market during periods of significant price volatility” — The Guardian
“Ofgem said re-activating it would not automatically create charges or push up customer bills” — Evening Standard
Left1 article
-
Ofgem could force energy suppliers to pay rivals if they lure customers with cheaper deals
Mixed Reports Ofgem's rationale alongside Martin Lewis's consumer-harm criticism and household bill pressures.
Centre1 article
-
Ofgem planning action to cushion energy firms from wholesale price swings
Neutral Short account mainly relaying Ofgem's explanation and reassurance, with no outside critics.
Right0 articles
No coverage yet.
- 16 Oct 09:14 First The GuardianLC Ofgem could force energy suppliers to pay rivals if they lure customers with cheaper deals
- 16 Oct 09:17 +2m Evening StandardN Ofgem planning action to cushion energy firms from wholesale price swings
Times are when each article was published, or when we first saw it if the outlet gave no time.
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