Labour has promised to install a new energy regulator and give it stronger powers – if it emerges victorious from the next election.
The party has already pledged to scrap the current regulator, Ofgem, and says it will give its replacement the power to revoke an energy firm’s licence.
The new rule would be applicable if an energy supplier committed “repeated instances of the most serious and deliberate breaches of their licence conditions”.
Ofgem said that it already had the power to revoke licences where companies ignore enforcement orders.
But Labour has accused the existing regime of being toothless, and said that firms were currently getting away with breaches by paying fines.
The party found that 16 energy companies were facing investigatory procedures into poor customer service and mis-selling practices.
Shadow energy secretary, Caroline Flint, said that the coalition government had harvested “a broken energy market”.
Trade bodies for the industry sprang to the defence of the current regime, however.
Energy UK said that current punitive measures were strong if firms were caught in breach of their licence.
“Having a strong set of licence conditions is essential for the protection of consumer rights”, it stated.
The government responded by saying it had measures in place for the industry. Firms will be required to simplify their bills, while talks are ongoing to reduce the time needed to switch suppliers.
Ofgem has said that it wants to introduce next-day switching within four years, but it believes that switching within just three days could be achieved much sooner.
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