Image caption Ofgem estimates a third of stolen electricity powers cannabis farms in the UK

The energy regulator wants power firms to do more to combat electricity theft, a third of which is stolen each year to power cannabis farms.

Ofgem has published proposals to combat a problem that it says costs customers £200m a year.

Ofgem said new rules should force suppliers to detect and investigate problems, or risk a fine.

The regulator estimates that there are up to 25,000 cases of electricity theft each year.

Under the proposals, suppliers are being asked to set up a national theft-risk assessment service to help them target premises where there are strong suspicions that electricity is being stolen, most commonly through tampering with meters.

Ofgem says theft costs paying electricity customers the equivalent of £7 each a year.

The Ofgem proposals include:

Setting up an industry code of practice governing how theft investigations should be carried out to ensure there is a consistent approach across the industry

Coordinating efforts to tackle theft relating to cannabis farms with other agencies such as the Home Office and local police forces

Sharing best practice across the industry about how cases of theft have been identified

Setting up a 24-hour hotline to report suspected theft

Andrew Wright, Ofgem chief executive, said: "The reforms build on similar obligations we introduced at the start of this year for suppliers to address gas theft more vigorously.

"All these measures will help to improve the confidence of consumers, who want reassurance that the energy market is fair."

'Positive move'

Energy UK, the trade association for the industry, welcomed Ofgem's consultation.

"Electricity theft is dangerous and illegal," it said. "Electricity theft also costs honest customers money which is why energy companies take this - and gas theft - very seriously.

"Ofgem's consultation is a positive move to cut down crime, and we look forward to working closely with them and others in the industry on this."

Ian Peters, managing director of residential energy at British Gas, said that the company would co-operate fully with Ofgem.

"Electricity and gas theft is a serious issue, which places lives at risk and adds unnecessary costs to customers' bills. We estimate that the annual cost to UK customers of gas and electricity theft is up to £500m."

The deadline for responses to Ofgem's proposals is 28 August, with a theft-risk assessment service scheduled to be up and running in the first quarter of 2015.