Energy UK response to Proposed Indicators: Ofgem performance and energy sector health

Executive summary

Energy UK is supportive of Ofgem’s intent to develop a clear, concise and accountable set of key performance indicators to measure both its own performance and the health of the energy sector. However, greater clarity on the proposed reporting and performance evaluation approach is needed. The indicators should also have clearer links to principles of good regulation, which can be developed from the Competition and Markets Authority’s 4Ps: pace, predictability, proportionality, and process.^[1]

The indicators should not be developed in isolation but be clearly grounded in the findings of DESNZ’s review of Ofgem, including the regulator’s statutory duties, which Energy UK has argued should be streamlined to focus on three key areas: current and future consumers, investment and innovation, and clean power^[2]. They should also be accompanied by a credible strategy demonstrating how Ofgem’s activities are expected to lead to strong performance against the indicators and positive consumer outcomes over both the short and long-term. Finally, there should be clear expectations on the frequency and transparency of reporting.

The proposed indicators do not effectively cover all the principles of good regulation as there is no measure of overall regulatory burden. While administrative burden is being considered for inclusion, this only represents a part of the total burden that Ofgem places on regulated energy companies. The more significant costs come from the way regulation is implemented and enforced, the uncertainty surrounding regulatory requirements, and the lack of clear responsibility in the governance of parts of the energy system.  

The scope of the indicators should be balanced and reflective of Ofgem’s regulated licensees, e.g., including heat networks, electricity and gas networks, power market participants, and energy suppliers.

[1] Competition and Markets Authority (2025), New CMA proposals to drive growth, investment and business confidence

[2] Energy UK (2025), The future of energy regulation: more efficient, lower cost, better outcomes