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The government has pledged to improve regulation within the heating oil sector in response to rapidly increasing bills affecting many customers. Officials have announced plans to strengthen existing rules, encourage greater competition, and provide clearer compensation pathways for consumers when problems arise. Additionally, they intend to reassess minimum order requirements currently imposed on certain customers.
Heating oil prices have nearly doubled over the past year, prompting some campaigners to urge that customers receive similar protections to those applying to standard gas and electricity tariffs in England, Scotland, and Wales. Despite these calls, the government has not indicated any intention to introduce a price cap for heating oil, nor have they specified when any new regulatory measures might be implemented.
Ministers emphasized their commitment to collaborating with the industry in developing a regulatory framework aimed at safeguarding consumers while fostering a competitive market environment for heating oil. Meanwhile, initiatives such as discounted heat pumps have been introduced, and a code of practice exists. The review of minimum order volumes, currently set at 500 litres for some users, is under consideration, noting that typical home storage tanks hold between 1,000 and 2,000 litres. This situation has led to some consumers being required to purchase more heating oil than they actually need.
Nick, a heating oil user living in West Suffolk, expressed concerns to the BBC’s Your Voice programme, describing off-grid households as a “major policy blind spot” for the government. He welcomed any consumer protections that cover all domestic heating oil users, having experienced prices rise to 111p per litre. Nick described heating his home as “no longer another household bill, but almost an investment.” He suggested tax reductions or extending the price cap to include heating oil, a position shared by the charity National Energy Action.
Tim Buckman, the CEO of the price comparison platform Boiler Juice, also advocated for stronger consumer protections, while highlighting that the fundamental issue lies with heating oil’s steep price increase since the start of the war. He stated, “Just putting regulation in place is not going to reduce the price for customers. What we would like to see is the VAT off heating oil or targeting that specifically.”
Approximately 1.5 million households depend on heating oil, yet unlike electricity and gas customers, they lack comparable consumer safeguards. The energy regulator Ofgem, which administers the price caps for gas and electricity tariffs, operates only in England, Scotland, and Wales. Notably, the majority of heating oil consumers are based in Northern Ireland, where 60% of households rely on this fuel and regulation falls under a separate jurisdiction. It is anticipated that Ofgem will extend regulation to heating oil in England, Scotland, and Wales. The UK government has also committed to working with the Northern Ireland Executive as they consider relevant regulatory recommendations
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