Off-grid competition works well

The findings of an Office of Fair Trading (OFT) study into off-grid energy have been welcomed by OFTEC.

Commissioned after concerns that some heating oil customers experienced high prices during last winter, the study found that a sudden increase in demand – up 40% on the previous year – at the same time as deliveries were hampered by severe weather, led to a short-lived ‘price spike’.  However, with 97% of off-grid households living in an area served by at least four suppliers, the OFT found that competition kept prices low over the year as a whole and that profit margins were not excessive.

Reassurance for oil customers

Commenting on the report, Jeremy Hawksley said:   “The findings are very reassuring for households that use oil, and show that there’s a good choice of suppliers across the country. Oil is one of the most competitively priced fuels in the off-grid sector providing heat for almost two million homes in the UK and Ireland.”

The OFT will be looking into complaints that some oil suppliers charged a different price on delivery from that quoted on order.  The study also looked at LPG and renewables – there were complaints about being locked into expensive LPG contracts following an initial introductory rate and concerns about the potential for mis-selling solar panels. When necessary the OFT will take steps to address unfair commercial practices.