Ofgem TPI Regulation: The Consultation Trail, the Registration Timeline, and What Small Brokerages Should Prepare Now

Broker regulation has been discussed for so long that some firms stopped listening. That is now a commercial risk. Government has confirmed that Ofgem will become the statutory regulator of third party intermediaries (TPIs), Ofgem spent mid-2026 gathering evidence on how the sector actually works, and the practical question for a five-person brokerage is no longer whether registration is coming. It is what registration will ask you to prove.

What follows is the consultation history, the timeline as it stands in September 2026, and the two areas where small firms can get ahead cheaply: written records of advice, and disclosure of commission.

How we got here: the consultation trail

The starting point was Ofgem's own work on the non-domestic market. Its Microbusiness Strategic Review in 2022 concluded that broker conduct was a real source of harm, and it used supplier licence conditions as the lever because Ofgem had no direct powers over brokers. From then on, non-domestic suppliers could only arrange contracts through brokers signed up to a qualifying dispute settlement scheme, in practice the Energy Ombudsman's energy broker scheme.

DESNZ then took the policy question on. After a call for evidence, it published a consultation on 20 September 2024, Regulating Third-Party Intermediaries in the Retail Energy Market. That document was blunt about the problem: requirements varied by TPI type, load controllers were being brought in under Part 9 of the Energy Act 2023, brokers sat under supplier licence conditions rather than direct rules, and voluntary codes of practice covered only part of the market. The preferred option was a general authorisation regime, under which any firm carrying out TPI activity must register and comply with a common set of conditions.

A government response followed on 23 October 2025. Respondents were broadly supportive, suppliers and consumer bodies among them, and a good number of TPIs said the same. Government confirmed it will legislate, when parliamentary time allows, to appoint Ofgem as TPI regulator with powers to set high-level principles and detailed rules, to run a registration process, to collect market data and to commission skilled person reports. Enforcement is to include fines, redress orders and exclusion from the market. Conduct requirements for senior individuals, along the lines of a fit and proper test for key decision-makers, were also confirmed as part of the design.

What Ofgem's 2026 market review changes

In June 2026 Ofgem opened a third-party intermediaries market review and call for input, covering domestic and non-domestic TPIs: brokers, price comparison websites, bill splitters and auto-switching services. Responses closed on 16 July 2026. The stated purpose is to build an evidence base on market structure, on the services being sold and on where customer harm arises, so that the rules are proportionate rather than borrowed wholesale from supplier regulation.

Two points in that review matter to small firms. Ofgem has said it will look at how to design the authorisation fee regime so it does not push efficient firms out of the market, which is the main cost worry for owner-managed brokerages. The review is also explicitly informing rule design, so the evidence Ofgem collects this year will shape what your compliance file has to contain later.

The registration timeline, realistically

Nothing requires you to register with Ofgem today. Here is the sequence that has to complete first, with the honest caveats.

• Primary legislation. Ofgem needs statutory powers over TPIs. Government has committed to this but tied it to parliamentary time, so no fixed date exists.
• Ofgem's market review report. A final report is expected in winter 2026/27, followed by policy consultations on the authorisation conditions, the rules and the fees.
• A sunrise period. For firms already trading, government indicated a transition of roughly 12 to 18 months from the framework being in place before authorisation becomes mandatory. After that, operating as a TPI without Ofgem authorisation becomes unlawful.

Put those together and the earliest realistic point at which registration bites is 2028, with a live scheme opening for applications some months before that. Industry commentary through 2026 has pointed the same way, noting that Ofgem's own sequencing pushes back the more optimistic reading of the DESNZ response. Plan for 2028. Do not bank on it slipping further, because a sunrise period is exactly the sort of thing that gets shortened when a scandal breaks.

The rules that already bite

While the authorisation regime is being built, existing obligations reach brokers indirectly through suppliers, and they are enforced now.

Commission disclosure is the big one. Following Ofgem's non-domestic market review, suppliers must disclose third party costs, including broker commission, to non-domestic customers, and from 1 October 2024 that applies to contracts with customers of any size rather than microbusinesses only. In practice the figure appears in the contract paperwork. If your own quotation or letter of authority is silent on uplift, the customer will find the number anyway, and they will find it after they have signed, which is the worst possible moment for your relationship.

Dispute resolution runs a close second. Access to the Energy Ombudsman was widened from microbusinesses to small businesses, using a threshold of fewer than 50 employees and turnover or balance sheet under £6.5m, and suppliers must signpost customers to Citizens Advice. Ofgem consulted again in late 2025 on licence changes to widen ombudsman access and the energy broker ADR scheme, with a lead-in period of around eight months for brokers to sign up. If you are not already in the broker scheme, treat that as a supplier onboarding condition rather than an optional badge.

One related point deserves a sentence and no more: heat networks came under Ofgem's authorisation regime from January 2026, and the drafting approach taken there is a fair preview of how TPI authorisation conditions may look.

Records of advice: what a compliance file needs

Authorisation regimes are evidence regimes. If you cannot show what you recommended and why, you will lose disputes you should win. Build the file now, on the deals you are writing this quarter, because retrofitting three years of contracts is far more expensive.

For each customer engagement, keep the signed letter of authority with its scope and expiry; the data you relied on, such as consumption, meter numbers and current contract end date; the panel of suppliers approached and who declined; the quotes received with dates and expiry times; the written recommendation and the reason for it; and the commission or uplift agreed, in pence per kWh and estimated total value over the term. Keep call recordings for telephone sales, with a retention period you can defend. Log every complaint with its outcome, even when it was resolved informally over the phone.

What to do in the next 90 days

• Write a one-page commission disclosure statement giving uplift in p/kWh and estimated contract-term value, and issue it with every quote before signature.
• Audit ten recent files against the record list above and fix the gaps in your CRM templates, not in a policy document nobody reads.
• Confirm your registration in the Energy Ombudsman energy broker scheme, and check that your complaints procedure names the scheme and gives realistic timescales.
• Name one person as the responsible senior individual for compliance and note it in board minutes, since fit and proper assessments will focus on decision-makers.
• Check Ofgem's TPI market review page each quarter, and diarise the final report in winter 2026/27 so you respond to the rules consultation that follows.
• Model a modest annual authorisation fee plus staff time into your 2027 and 2028 budgets, and set a floor margin per contract that survives it.