Government and Ofgem have sleepwalked into this energy crisis

theguardian.com:

For the last umpteen years Ofgem has offered parental-sounding advice when adjusting the energy price cap. “Switch to save money,” the regulator trumpeted last February as the maximum rate was raised by £96. Even last autumn, when £139 was added, Ofgem was still saying customers “can avoid the increase by shopping around”.

There’s no escape now. As the thumping £693 increase from April landed on Thursday, the regulator merely offered a limp line about how it knows it’s all “extremely worrying for many people”. It, like everybody else, knows there aren’t better deals to switch to. Competition has disappeared. The price cap has become the floor rate, not the ceiling. Roughly 80% of households are on it – the main exceptions being those who had the luck or foresight to secure a fixed rate before wholesale gas prices quadrupled.

To put it mildly, the energy supply market looks nothing like the one Ofgem has spent a couple of decades trying to encourage. Some 29 suppliers – half the tally last June – have gone bust and the high corporate casualty rate cannot be pinned solely on the “unprecedented” (the regulator’s favourite word) rise in gas prices.

At least part of the blame falls on a rotten regulatory system that allowed undercapitalised companies to try their luck by operating with skimpy hedging policies on energy-purchase contracts. Ofgem had a go at tightening licence rules a couple of years ago, but merely tweaked. The admission by the chief executive, Jonathan Brearley, in December that a proper version of “financial resilience” is required arrived extremely late in the day.

Some £68 of the £693 increase in the cap, note, relates to industry-wide “supplier of last resort” levies – in other words, the cost of moving