UK Energy Policy and Market Structure
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Ofgem
The Office of Gas and Electricity Markets (Ofgem) is the independent energy regulator for Great Britain, established by the Utilities Act 2000. Ofgem operates under statutory duties set by Parliament, principally to protect the interests of existing and future consumers, promote competition, and oversee the security and sustainability of the energy system.
Ofgem holds the price cap setting function, supplier licensing authority, network price control responsibility (RIIO frameworks), and the supplier-of-last-resort regime. Decisions are made by an independent board accountable to Parliament and reviewable by Competition Appeal Tribunal.
Department for Energy Security and Net Zero
DESNZ is the government department responsible for UK energy policy, replacing the former Department for Business, Energy and Industrial Strategy in 2023. DESNZ sets primary legislation, energy security strategy, and the net-zero transition framework, Ofgem operates within the policy boundaries DESNZ sets.
Recent DESNZ activity includes the 2022 Energy Bills Support Scheme, the 2024 cap reform consultation alongside Ofgem, the Boiler Upgrade Scheme for heat pumps, and the Smart Export Guarantee for solar PV export.
Distribution network operators
Six DNOs operate the electricity distribution networks across the 14 regions. UK Power Networks (London + Eastern + South East), Western Power Distribution (Midlands + Wales + South West), Northern Powergrid (Yorkshire + North East), Electricity North West (North West), Scottish and Southern Electricity Networks (Southern + North Scotland), and SP Energy Networks (Merseyside + South Scotland). DNOs operate under RIIO-ED price controls, the current RIIO-ED2 covers 2023-2028.
Retail supplier framework
Approximately 40 retail energy suppliers operate in GB. Suppliers must hold an Ofgem licence, comply with the Standard Licence Conditions, and meet the financial-resilience requirements introduced post-2021 crisis. The Big Six historically were British Gas, EDF, E.ON, npower, Scottish Power, and SSE; npower was acquired by E.ON in 2019, and SSE retail merged with OVO to become OVO Energy. Smaller specialists include Octopus Energy, Bulb (failed 2021, transferred to Octopus 2022), Good Energy, Ecotricity, and many others.
Political economy
Energy bills sit at the intersection of consumer affordability, climate policy, and energy security. The 2022 wholesale crisis prompted unprecedented government intervention via the Energy Price Guarantee and Energy Bills Support Scheme, costing approximately £40 billion. The post-crisis policy landscape continues to evolve, with active questions about standing-charge structure (Ofgem 2024 consultation), social tariff design, and the long-run trajectory of household heating decarbonisation.
Sources
According to Ofgem, the default tariff cap has been reset every quarter since January 2019, when it launched at £1,137 a year for a typical dual-fuel household; it peaked at £4,279 in January 2023 during the energy crisis before falling back. Every price-cap figure on PlainEnergyBills is drawn from Ofgem's published quarterly decisions and public UK supplier registers, see our methodology for the full sources and method.