Switching energy this winter: your rights, and what Ofgem's Market Stabilisation Charge could mean

What's happened

Ofgem is consulting on switching on the Market Stabilisation Charge, a payment that passes between energy suppliers when a customer switches. The consultation opened on 16 October 2026 and closes on 29 October. Ofgem says it expects to decide a couple of weeks after that, and if it goes ahead, the charge would be activated shortly after and stay in place at least until the end of winter.

Ofgem says wholesale gas prices have risen since July to around 200p a therm, about 150% higher than before the conflict in the Middle East, and that the share of households on standard variable tariffs has risen by seven percentage points since April 2026.

Citizens Advice said the charge "can limit the short-term savings people can make by switching", but that it helps keep suppliers resilient to "wild swings in wholesale energy costs". Gillian Cooper, its Director of Energy, said energy prices are "back in dangerous territory".

What the charge does

Suppliers have to buy energy in advance for customers on the price cap. If wholesale prices then drop sharply and lots of those customers leave for cheaper fixed deals, the old supplier is left with energy it paid too much for. The charge makes the new supplier pay the old one part of that loss.

Under Ofgem's proposals it would only kick in if wholesale prices fall more than 10% below the level built into the price cap. Beyond that point, the losing supplier would get 85% of the value of the energy it's left holding. It's a payment between suppliers, not a fee on your bill, and Ofgem says it won't apply at all unless prices fall significantly. When the charge ran from 2022 until it lapsed in March 2024, Ofgem says fixed deals were priced "slightly higher" than they would otherwise have been, and payments totalled more than £80 million, less than £2 per household a year.

What the rules say

Your switching rights come from suppliers' licences under the Gas Act 1986 and Electricity Act 1989, and from the Electricity and Gas (Standards of Performance) (Suppliers) Regulations 2015. Ofgem enforces them in England, Scotland and Wales. Northern Ireland has its own regulator, the Utility Regulator, and different rules.

• Five working days. Ofgem says a switch must happen within five working days. If it doesn't, your new supplier must pay you £40.
• No exit fees near the end of a fix. Citizens Advice says you can leave without an exit fee if you have 49 days or less left. With 50 days or more, you may have to pay one.
• Fourteen days to change your mind. You can cancel a new contract within 14 days without a fee.
• Credit back. Your old supplier must send a final bill within six weeks and refund any credit within 10 working days of sending it.
• Debt. You can switch if you've owed money for less than 28 days. Prepayment customers can switch owing up to £500.
• Switched by mistake. You can get £40, and your old supplier has 21 working days to switch you back.

What it means in pounds: a worked example

This is an illustration, not a real case.

Amira's fixed tariff ends on 10 December 2026. On 25 October she has 46 days left, so she can switch without an exit fee. Had she tried on 20 October, with 51 days left, she could have been charged whatever exit fee her contract sets.

Her account is £150 in credit. She gives both suppliers a meter reading on the switch date. Her old supplier must send the final bill within six weeks and refund the £150 within 10 working days after that. If the switch takes longer than five working days, the new supplier owes her £40.

The Market Stabilisation Charge doesn't change any of that.

What to do now

1. Check your end date and any exit fee on your bill or online account.
2. Compare before your fix ends. If you do nothing, you'll usually move to your supplier's standard variable tariff.
3. Consider your own supplier too. Ofgem's proposal describes a payment between the supplier you leave and the one you join, so ask your current supplier what it can offer too, and check how any final rules treat a tariff change with the same supplier.
4. Take a dated meter photo on switch day and send the reading to both suppliers.
5. Chase your credit. If it isn't refunded within 10 working days of the final bill, complain in writing.
6. Escalate if you need to. If a complaint isn't sorted within eight weeks, or you get a deadlock letter, go to the Energy Ombudsman for free. Citizens Advice can help in England and Wales, Advice Direct Scotland in Scotland, and the Consumer Council in Northern Ireland.

Your questions answered

Will the Market Stabilisation Charge appear on my bill?

No. It's paid by one supplier to another, though it can nudge fixed tariff prices up slightly while it's active.

Does it stop me switching?

No. Your right to switch, and to leave a fix without an exit fee in the last 49 days, stays the same. Ofgem says the charge only covers part of any price fall, so there should still be "significant gains" from switching in a falling market.

Can my supplier block my switch if I owe money?

If you've owed money for more than 28 days, you'll need to pay it off first. Prepayment customers can switch with debts of up to £500.

Sources: Ofgem: Market Stabilisation Charge activation consultation, Ofgem: consultation document, Citizens Advice response, Ofgem: switching energy supplier, Citizens Advice: switching energy supplier, Electricity and Gas (Standards of Performance) (Suppliers) Regulations 2015, Energy Ombudsman