Heating oil customers face tough winter despite shake-up promise
Heating oil customers facing soaring bills are promised better regulation of the sector by the government.
Key points
- UK ministers promise stricter rules and clearer compensation for heating oil customers but no timetable.
- Heating oil prices have nearly doubled in a year, with quotes reaching 111p per litre.
- A CMA inquiry found 1,700 households forced to re-order at higher prices, costing up to £350.
UK ministers have pledged to tighten regulation of the heating oil market, but there is no sign of a price cap or a timeline for the stricter rules. The move follows a year in which heating oil prices have nearly doubled.
The government said it will work with industry to "develop a regulatory regime for the heating oil market, protecting consumers and promoting competition". Minimum order volumes of 500 litres for some customers will be reviewed, and oil users have been offered discounts on heat pumps.
What the CMA found
The Competition and Markets Authority found that 1,700 households were forced to "re-order at significantly higher prices or go without fuel" after the US-Israeli war with Iran began, costing them up to £350. Those whose orders were cancelled and prices raised were told they were entitled to compensation.
The government has now accepted the CMA's recommendation to strengthen regulation in the sector. Energy minister Polly Billington said thousands of customers "felt they had nowhere to turn" when prices rose earlier this year.
Thousands of heating oil customers felt they had nowhere to turn when they paid the price of rising oil and gas costs earlier this year.
— Energy minister Polly Billington
Consumer concerns and next steps
Nick, a 28-year-old heating oil customer from West Suffolk who rents a three-bedroom home, told the BBC that "off-grid households remain a major policy blind spot" and that prices had more than doubled to 111p per litre. He called for tax cuts or an extension of the price cap.
Tim Buckman of Boiler Juice said regulation alone would not lower prices and urged VAT to be removed from heating oil. About 1.5 million households depend on heating oil, mostly in Northern Ireland, where 60% of homes use it; Ofgem's cap covers only England, Scotland and Wales.
