Heating oil customers facing soaring bills have been promised better regulation of the sector by the government. Ministers say they will tighten up rules, promote competition and give customers clearer compensation routes if things go wrong. Minimum order levels, set for some customers, will be reviewed.
With prices close to having doubled in the past year, some campaigners have called for heating oil customers to benefit from the same cap as regular, variable gas and electricity tariffs in England, Scotland and Wales. But there is no sign of the government proposing such a change, nor when the stricter rules will take effect. Ministers said they would work with industry to "develop a regulatory regime for the heating oil market, protecting consumers and promoting competition".
In the meantime, oil users have been offered discounts on heat pumps, a code of practice is in place, and industry practices setting minimum order volumes at 500 litres for some consumers will be reviewed. Domestic tanks typically hold between 1,000 and 2,000 litres. The government said this had left some people having to pay for more heating oil than they might need.
Buy now or wait and hope? Families face gamble on heating oil Prices have soared since the start of the US-Israeli war with Iran. In March, the government announced a support package worth £53m for low-income families who use heating oil.
The funding is distributed by local authorities, which set their own criteria for eligibility. A subsequent inquiry by the UK's competition watchdog, 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 war broke out, costing them up to £350. But those whose orders were cancelled and prices raised were told they were entitled to compensation.
The government has now announced it will accept the CMA's recommendation to strengthen regulation in the sector. Energy minister Polly Billington said: "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 is an essential good and people should not have to think twice about whether they're protected in the market.
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