The UK’s energy regulator, Ofgem, has recently announced an investigation into Maxen Power Supply Ltd, a non-domestic energy supplier based in East London. The focus of the inquiry is the supplier’s treatment of its business customers, particularly microbusinesses, and the rates charged to them.
The investigation aims to ensure that Maxen Power is complying with various Standard Licence Conditions (SLCs) set by Ofgem, which govern how energy suppliers should operate and treat their customers.
Key Focus Areas of the Investigation
- Fair Treatment of Microbusinesses (SLC 0A)
Microbusinesses are often more vulnerable to unfair treatment due to their smaller size and limited resources. Ofgem’s SLC 0A mandates that energy suppliers like Maxen Power must treat these businesses fairly, acting in a transparent, honest, and professional manner. The investigation will assess whether Maxen is upholding these standards, ensuring that microbusinesses are not disadvantaged. - Organisational Capability (SLC 4A)
Suppliers are required to maintain the necessary infrastructure and capabilities to meet regulatory obligations under SLC 4A. Ofgem will scrutinise whether Maxen Power is operationally equipped to deliver services to its customers while protecting them from unnecessary risks. - Fairness of Deemed Contract Rates (SLC 7.3)
Deemed contracts occur when a customer has not actively agreed to the terms of their energy supply, often after moving into a new property or when a previous contract expires. SLC 7.3 ensures that suppliers make efforts to offer reasonable terms and that the rates under deemed contracts are not overly burdensome. The investigation will determine whether Maxen’s rates for these types of contracts are just and fair for their business customers. - Treatment of Microbusiness Consumers (SLC 7A)
Microbusinesses are entitled to specific protections under SLC 7A, and Ofgem will be examining whether Maxen Power has been fulfilling its obligations to provide these protections. The investigation will review Maxen’s handling of microbusiness customers, ensuring they receive fair terms and pricing. - Customer Transfer Blocking (SLC 14)
Ofgem’s SLC 14 prohibits energy suppliers from blocking a customer’s switch to another provider, unless certain conditions are met, such as unpaid bills. The regulator will investigate whether Maxen Power has been preventing any customers from switching to alternative suppliers without valid reasons.
Importance of the Investigation
This investigation comes at a crucial time as energy costs remain a significant concern for businesses across the UK. Microbusinesses, in particular, are often more susceptible to high energy costs and unfair terms, making the outcome of this inquiry important for ensuring their protection. By launching this investigation, Ofgem is demonstrating its commitment to promoting fairness and transparency in the energy market.
The findings of the investigation will help clarify whether Maxen Power has complied with its regulatory duties and, if not, may result in enforcement actions, including fines or other penalties. For businesses, this is a positive step towards ensuring they receive fair treatment and competitive rates from their energy suppliers.