Good Law Project to sue Ofgem over price cap hike

GLP plans to sue Ofgem in conjunction with Fuel Poverty Action and the Highlands & Islands Housing Associations Affordable Warmth Group.

This comes as Ofgem announced its plans to raise the energy price cap to a £3,549, a rise of 80%. The announcement has faced widespread backlash. Many households face a tough winter ahead, as rising bills have fuelled further inflation, which breached 10% last month. Good Law Project described the rise of the energy cap as “eye watering”, in a statement released on their website.

GLP had previously written to Ofgem in July to express concern over decision-making. GLP asked that Ofgem provide proof of its impact assessment, but no such evidence was presented. GLP subsequently put the regulator on a notice of impending formal legal action.

The statement specified that the hike will: “Push millions of people into poverty this winter”, highlighting that the average household bill will be going up by £1,578, rising 80%. GLP believes that Ofgem has the power to do more to protect vulnerable people and, before raising the cap, Ofgem is legally required to: provide evidence it has carried out a proper impact assessment and consider appropriate mitigation measures for the most vulnerable, including a lower social tariff. GLP feel that Ofgem has failed to take a proper course of action prior to raising the cap.

Jo Maugham, director of GLP, said: “The announcement today will devastate families. Just who and what is Ofgem for? Do not be fooled. This is a choice. And the choice they’ve made is to let low-income consumers and small businesses bear the brunt of this crisis.”

Maugham continued: “We believe Ofgem can, and should, do more. We intend to put the question before the High Court and will ask for a fast-tracked timeline to reflect the urgency of this crisis.”

Credit Strategy reached out to Ofgem for comment, and a spokesperson had this to say: “We can confirm that Ofgem has received a letter from the Good Law Project, and we have replied. We want to be clear that we continue to use all our levers to support consumers, but more help is needed. That is why we are asking that when the new Prime Minister takes office, they take urgent and decisive action. Once they announce what additional support packages will be available, Ofgem will continue to examine how best it can help those groups of people that need it the most.”