LONDON, May 16 (Reuters) - Britain's energy regulator Ofgem said on Monday it planned to review a price cap on consumer bills every quarter rather than twice a year to reflect the volatile price swings in the market. Britain introduced a price cap in 2019 to prevent companies from overcharging consumers, but surges in wholesale markets following the reopening of the global economy from COVID lockdowns and the invasion of Ukraine have forced it higher.
The price level jumped by 54% in April and it is currently predicted to go up again in October.
Ofgem said in a statement that moving to a quarterly review would mean the cap is more reflective of current market prices and any price falls would be delivered more quickly to consumers.
"The last year has shown that we need to make changes to the price cap so that suppliers are better able to manage risks in these unprecedented market conditions," Ofgem Chief Executive Jonathan Brearley said.
Ofgem will now launch a new consultation on the plan with the industry. The price cap will change in October and if a quarterly review is adopted it would be introduced for January. (Reporting by Kate Holton, Editing by Kylie MacLellan)