Investigation Reveals High Deemed Rates for Many Without Fixed Contracts

  • Ofgem urged to act on ‘out of contract’ energy rates
  • Box Power conducted an investigation in July finding 50% of suppliers’ deemed rates were grossly unduly onerous
  • Deemed rates often applied to businesses, charities or organizations without a fixed rate or contract
  • Currently, only microbusinesses are legally protected from unduly onerous rates
  • Box Power proposes ‘Wholesale Price Plus’ mechanism for fairness and supplier compensation

Box Power, the social enterprise that prompted a consultation on hidden broker fees, is urging Ofgem to take action on ‘out of contract’ energy rates. An investigation by Box Power found that 50% of suppliers’ deemed rates are excessively high for businesses without fixed contracts or those at the end of their term. The company argues that these rates should be sold at cost price, with no profit for suppliers. Currently, only microbusinesses have legal protection against unduly onerous rates. Box Power proposes its ‘Wholesale Price Plus’ mechanism to ensure fairness and supplier compensation.

Factuality Level: 8
Factuality Justification: The article provides accurate and objective information about the issue of unduly onerous deemed rates in the energy sector and includes quotes from Box Power CEO Corin Dalby. It also mentions Ofgem’s response to the problem and presents a proposed solution (Wholesale Price Plus) without any significant digressions, misleading information or personal opinions masquerading as facts.
Noise Level: 3
Noise Justification: The article provides relevant information about the issue of unduly onerous deemed rates in the energy sector and suggests a potential solution through Box Power’s ‘Wholesale Price Plus’ mechanism. It also mentions the involvement of Ofgem and the Chancellor Jeremy Hunt. However, it could benefit from more detailed explanations and evidence to support its claims.
Financial Relevance: Yes
Financial Markets Impacted: Energy market in the UK
Financial Rating Justification: The article discusses energy prices and contracts for businesses, which can impact the energy sector and related companies in the UK.
Presence Of Extreme Event: No
Nature Of Extreme Event: Other
Impact Rating Of The Extreme Event: Minor
Extreme Rating Justification: There is no extreme event mentioned in the text.

Reported publicly: www.retailsector.co.uk