Ofgem has closed its consultation on new guidance aimed at improving governance arrangements for energy supply licensees. The proposals, published on 30 January 2025, seek to enhance financial resilience and ensure robust decision-making across the retail energy market. Key measures include:
- Independent oversight and better management of conflicts of interest.
- Greater transparency in governance structures.
- Updates to Standard Licence Condition (SLC) 4A on operational capability and SLC 28C on milestone assessments, requiring suppliers to demonstrate governance arrangements that support growth plans.
The regulator favors a principles-based approach but warns that prescriptive rules may follow if outcomes fall short. These steps respond to lessons from supplier failures during 2021–22, aiming to reduce market instability and protect consumers. Stakeholders, including consumer groups and supply licensees, were invited to provide feedback before the consultation closed on 25 April 2025. Ofgem will publish responses and next steps in due course.