Finance Editor, Kael Tripton Ltd - LBS MBA - Verified against FCA Handbook: 14 June 2026
Quick answer
All domestic energy suppliers must hold an Ofgem supply licence. Licence conditions require them to comply with the price cap, bill accurately, respond to complaints within 8 weeks, maintain a Priority Services Register and participate in the Energy Ombudsman scheme. Breaches can result in fines of up to 10% of turnover or licence revocation.
What Must Your Energy Supplier Do Under Ofgem Rules?
Direct answer
What are my energy supplier's legal obligations under Ofgem?
All domestic energy suppliers must hold an Ofgem supply licence (verifiable at ofgem.gov.uk/check-supplier-licence-status). Licence conditions require: price cap compliance on default tariffs, bills at least every 6 months, complaint response within 8 weeks, Priority Services Register for vulnerable customers, and participation in the Energy Ombudsman ADR scheme.
Register for the Priority Services Register
Contact your gas and electricity supplier directly. Registration is free and gives you additional support including advance notice of outages and accessible bills.
Check your supplier's licence status
Go to ofgem.gov.uk/check-supplier-licence-status to verify your supplier holds a valid Ofgem licence.
Challenge a Deemed Contract rate
Write to the supplier stating you are on a Deemed Contract and requesting their standard tariff or a switching information pack. You can switch to a new supplier at any time from a Deemed Contract.
Report a licence breach to Ofgem
If your supplier is breaching licence conditions (charging above the cap, failing to respond to complaints, disconnecting without proper process), report to Ofgem at ofgem.gov.uk/contact-us.
Complain to the Energy Ombudsman
For individual disputes not resolved by the supplier within 8 weeks, escalate to the Energy Ombudsman at energy-ombudsman.com.
| Obligation | Ofgem requirement | Consequence of breach |
|---|---|---|
| Price cap compliance | Cannot charge above Ofgem cap on default tariffs | Licence breach -- Ofgem fine up to 10% turnover |
| Billing frequency | Bills at least every 6 months | Licence breach -- Ofgem enforcement |
| Complaint response | 8 weeks maximum | Must refer to Energy Ombudsman |
| Priority Services Register | Must maintain and offer free | Licence condition breach |
| ADR scheme | Must participate in Energy Ombudsman | Licence condition breach |
| Financial resilience | Must pass Ofgem financial tests | Licence review or revocation |
Related KT guides
Frequently Asked Questions
What are energy suppliers' obligations under Ofgem?
Under the Gas Act 1986 and Electricity Act 1989 (as amended), energy suppliers must hold an Ofgem supply licence to supply gas and electricity to domestic customers. Their licence conditions require them to: charge no more than the Ofgem price cap on default tariffs, issue accurate bills at least every 6 months, respond to complaints within 8 weeks, participate in an Ofgem-approved ADR scheme (the Energy Ombudsman), maintain a Priority Services Register for vulnerable customers, and maintain adequate financial resilience.
What is the Priority Services Register?
The Priority Services Register (PSR) is a free service offered by all Ofgem-licensed energy suppliers and network operators to support vulnerable customers. Customers who are eligible include those who are disabled or have a long-term medical condition, are over 60, have young children, are pregnant, or have communication difficulties. PSR customers receive additional services including advance notice of planned power cuts, priority support in emergencies, and accessible bills and communications.
Can my energy supplier cut off my supply?
Domestic energy suppliers cannot cut off supply to vulnerable customers (those on the PSR) without making alternative arrangements. For non-vulnerable customers in debt, suppliers must follow Ofgem's debt management rules before disconnecting, including offering a payment plan and giving adequate notice. Disconnecting supply without following these procedures is a breach of supply licence conditions.
What is the Deemed Contract rate and how do I escape it?
A Deemed Contract applies when you move into a property and take supply from the existing supplier without signing a contract. Deemed Contract rates are typically significantly higher than standard market rates and are not subject to the Ofgem price cap in the same way as contracted supply. To escape the Deemed Contract, contact the existing supplier and either sign a contract or switch to a new supplier. Ofgem has consulted on capping Deemed Contract rates but as of June 2026 the rules remain under review.
What is Ofgem's enforcement process for supplier breaches?
If an energy supplier breaches its licence conditions, Ofgem can issue a Provisional Order (requiring immediate action), a Final Order, or open a formal investigation. Ofgem can also issue financial penalties of up to 10% of the supplier's annual turnover for licence breaches. In serious cases, Ofgem can revoke the supply licence. When suppliers fail, Ofgem activates the Supplier of Last Resort process, transferring customers to a new supplier at protected rates.
Primary sources
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