Energy network operators face enforcement action from Ofgem following power delays from Storm Arwen.
Ofgem has agreed with electricity companies to lift the £700 cap on compensation for customers “as a gesture”, as it criticised the lack of communication.
It comes after the regulator announced it was launching a review of the response by firms to the gale force winds that pounded northern England and Scotland, causing damage to overhead lines and leaving communities without electricity for lighting, heating, cooking and communication.
In some instances, it took providers more than a week to restore energy in thousands of homes, and some remain unfixed, which has coincided with further cold weather.
The Ministry of Defence deployed nearly 300 army and Royal Marines to support authorities in impacted areas.
Jonathan Brearley, Ofgem’s chief exec said: “We understand this is a really worrying time for people who are without heat and power as the severity of Storm Arwen has hit homes and businesses in the North of England and Scotland. The effects of Storm Arwen are still being felt with 10,500 homes still without power.
“We accept the network companies have been working in challenging conditions, but until every home in Britain has power restored, that relentless effort must continue. We are launching a review into how the storm has been handled. We have strict rules on how network companies need to operate in these circumstances, and we will take action if needed.”