Source · Select Committees · Welsh Affairs Committee
Recommendation 19
19
Rejected
Paragraph: 98
Ofgem, as the market regulator, must ensure that the regulatory environment enables the decarbonisation of...
Conclusion
Ofgem, as the market regulator, must ensure that the regulatory environment enables the decarbonisation of energy markets. Whilst ensuring the best value for consumers is important and should remain one of Ofgem’s primary considerations, this should be balanced against achieving net zero targets.
Government Response Summary
The government does not consider an amendment to Ofgem’s primary duty necessary, as they believe the existing duty to protect consumers' interests already includes the reduction of greenhouse gases.
Paragraph Reference:
98
Government Response
Rejected
HM Government
Rejected
Ofgem’s primary statutory duty is to protect the interests of existing and future gas and electricity consumers. The interests of such consumers are their interests taken as a whole, including their interests in the reduction of greenhouse gases and the security of the supply of gas and electricity to them. The Government and Ofgem are clear that the duty to protect consumers’ interests includes the reduction of emissions of targeted greenhouse gases in line with net zero. Therefore, the Government does not consider an amendment to Ofgem’s primary duty to be necessary to achieve the goals the Committee seeks. The Government is also working to develop its Strategy and Policy statement (SPS) for energy policy in Great Britain, a key legislative instrument set out in the Energy Act 2013. The SPS is intended to consolidate all the Government’s commitments in relation to energy policy in one place and to offer the strategic steers on how to balance them against each other so that Ofgem can prioritise effectively in line with Government’s ambitions. The priorities of the SPS will include, but not be limited to, advancing a net zero energy system that is affordable, secure and resilient, and delivers good outcomes for consumers. The SPS will impose a legal obligation on Ofgem to have regard to those strategic priorities and policy outcomes when exercising its regulatory functions.