Ofgem said it wanted households to receive at least £30 for each switching difficulty, saying "too many" consumers were encountering problems.

These included, the regulator said, people being mistakenly switched to another supplier, switches taking longer than 21 days to complete and providers taking too long to refund credit balances.

The watchdog and consumer groups say switching remains the most effective way of cutting bills - often by hundreds of pounds a year - as the government moves to crackdown on standard variable and default tariffs through a planned cap.

Ofgem said its plans were part-based on research which found many are put off changing supplier for fear of something going wrong or because of previous bad experiences.