Ofgem will be transformed to enable faster redress for households and direct enforcement of consumer law, reducing the need for lengthy court proceedings.

The reforms extend regulatory coverage to new areas and customers, such as heating oil, amid price volatility and limited current regulation.

The government unveiled reforms to strengthen Ofgem, giving the energy regulator expanded powers to enforce consumer protection and to ban bonuses for executives when licence breaches significantly harm consumers.

Energy Secretary Ed Miliband and Energy Consumers Minister Martin McCluskey framed the changes as delivering stronger household protections, a fairer market, and greater accountability for energy executives.

The reforms respond to a more complex energy market by expanding regulation to products and customers previously less protected, including heating oil users who faced price spikes amid Middle East tensions.

Officials argue the market has grown in complexity with more products and services, including heating oil, which has experienced price spikes during ongoing conflicts.

Interim Ofgem chief executive Tim Jarvis said reforms are needed to adapt to a rapidly evolving energy system, balancing robust consumer protection with investor confidence.

Jarvis framed the moves as essential for an increasingly electrified and flexible energy system, aiming for reliable, attractive, and stable conditions for both consumers and investors.

Industry reaction was mixed: Energy UK urged more radical reforms for a streamlined regulator, while Citizens Advice welcomed stronger protections and enforcement for consumers.

Jarvis emphasized adapting to an electrified, flexible system and delivering systemic reforms that protect consumers while attracting investment.

The overall aim is to strengthen consumer protections, improve regulator effectiveness, and address affordability and fairness in the evolving energy market.

The reforms seek a balance between safeguarding consumers, supporting investment, and fostering a well-functioning, innovative energy market while addressing affordability concerns.