Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps he plans to take in response to Ofgem’s July 2020 consultation, Supporting Retail Innovation, to provide derogations from standard licence conditions and grant supply licences for specific geographic areas or premises types; and whether Ofgem plans to progress its consideration of a local electricity supply licence.

The right to local energy supply already exists under the Electricity Act 1989. As the independent regulator, Ofgem has powers to award supply licenses that are restricted to specified geographical areas or premise types. In some circumstances, electricity suppliers can also apply to Ofgem for a derogation from a particular provision of their supply licence. If granted, those provisions of the supply licence will not apply.

In July 2020 Ofgem consulted on proposed changes to their approach to granting supply licences for specific geographical areas or premise types and to supply licence conditions relating to derogations, to support innovation in the retail energy market. The consultation closed on 12 October 2020, and we await Ofgem’s announcement on any next steps.