UKH demands energy firms named and shamed

16-Jan-2023 - Last updated on 16-Jan-2023 at 11:21 GMT

Action demanded: UKHospitality wants Ofgem to penalise rogue energy comapnies (credit: getty/vm)

UKHospitality (UKH) has called for energy watchdog Ofgem to take action against energy companies that have implemented improper practices and treated businesses in the sector as a ‘cash cow’.

In the letter to Ofgem, UKH chief executive Kate Nicholls urged it to “name and shame” energy companies that were treating hospitality operators unfairly.

In light of energy support set to be significantly reduced from 1 April, she cited rogue energy suppliers as offering rates well above wholesale prices, hiking standing charges, demanding eye-watering deposits, and, in some cases, refusing to work with hospitality.

UKH has demanded Ofgem publishes the outcome of its inquiry into the non-domestic market as soon as possible and ‘name and shame’ the businesses considered to have acted in bad faith, and all examples of bad practice to be penalised and businesses able to renegotiate or cancel terms – business should be able to seek compensation where appropriate.

Contract renegotiation

It also wants energy suppliers who have customers on fixed contracts at over double the Government’s floor price to be compelled to offer a renegotiation of contracts and an end to blanket withdrawal of quotes to sectors – a refusal to quote should only be on the basis of individual business circumstances.

Nicholls said: “The behaviour of energy suppliers over the past four months has been nothing short of disgraceful. It’s clear some rogue companies saw the significant intervention by the Government to support business as nothing more than a cash cow.

“Day after day, we get more reports from businesses with another example of how an energy supplier is demanding outrageous sums of money to secure a contract on sky-high terms or, even worse, won’t even engage on a contract simply because a business works in hospitality.”

Investigation must be concluded

She continued: “I’m pleased the Government took our reports about this situation seriously and that Ofgem began its inquiry. However, we now need to see the conclusion of that investigation and urgent action as soon as possible. With support being greatly reduced from April, businesses are heading into the most perilous financial position yet.

“The worst culprits should be named and shamed by the regulator and all suppliers that have engaged in this sort of behaviour should be compelled to go back to their customers to renegotiate their prices.

“If businesses don’t have a route to renegotiate, thousands will be stuck on extortionate fixed tariffs that they were heavily encouraged to agree to.

“With a positive resolution, we can see our sector bounce back quickly and return to the economic growth, job creation and investment it is known for. If energy suppliers are allowed to continue to conduct themselves in such an unfair manner, without fear of reprisal, businesses will fail across the sector and across the country as a result.”