Ofgem boss admits he should have acted sooner to prevent energy suppliers collapsing

The boss of Ofgem has admitted that he could have better protected households facing soaring energy bills by acting sooner to prevent a wave of suppliers collapsing.

Jonathan Brearley, the regulator’s chief executive, defended the energy price cap but said suppliers needed to be subject to tougher financial rules.

Financial regulation “needs to be tougher”, he told MPs on the Business, Energy and Industrial Strategy Committee.

“We need a retail sector that’s more resilient and more able to deal with financial shocks,” the Ofgem boss said.

“To be clear, chair, we accept that, had we done that sooner this would have been better for customers.”

He conceded that “our regulation needs to change”.

His comments came after 29 suppliers collapsed, with the costs passed on to all retail energy customers through a levy on bills.

Mr Brearley said that government’s priority had previously been to get new suppliers into the market and challenge the dominance of the Big Six providers.

He added: “It would have been better to have higher barriers to entry for new suppliers,

However, he defended the energy price cap, which will jump by 54 per cent on 1 April.

“The price cap has worked it protected customers across winter and if you look back over its history it has made sure customers are paying no more than they need to for their energy,” Mr Brearley said.

“But without doubt it’s going to have to become more flexible and more adaptable now that we are in what’s wuite possibly a more volatile energy market.”