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Energy companies must take action to help customers overpaying on their bills

Alex Neill, Managing Director of Home & Legal | Which?

3 min read Partner content

Managing Director of Home & Legal Services at Which? calls on UK energy companies to publish plans by January 2017 on how they will engage with customers on the worst tariffs.


During the Conservative party conference a month ago, I wrote for PoliticsHome that the UK’s energy companies were in the last chance saloon and would only have themselves to blame if the regulator and the Government intervened.

The Competition and Markets Authority (CMA) investigation, which wrapped up in June, should have served as a wake up call to the energy companies. Months later and most energy customers have had little to no contact from their supplier since the inquiry, and with cold weather just around the corner, many are still paying over the odds on their energy bills to keep the heating on.  

Energy companies must not delay any longer - it is critical they step up their engagement with their customers now. Giving people more information about the deal they're on, the kind of savings they could be making and other essential information about the services they provide are critical to getting energy customers moving. While we've seen attempts to give hard-pressed bill payers this kind of information in recent years - such as putting the cheapest tariff on people's bills - these nudges and prompts have failed to make a difference.

Which? is calling on all energy companies to now redouble their efforts and find new ways of getting customers stuck on poor value deals to move, and to tell Which?, and their customers, how they plan to do this.

The biggest difference should be seen with standard variable tariff customers. An astonishing 16 million people – that's over half (58%) of energy customers - are stuck on the default and usually most expensive tariff with a ‘Big Six’ provider.

The CMA has said that more must be done to get energy companies to engage these customers. Yet, new Which? research has found that three-quarters (74%) of people said they have not been contacted by their supplier about changing their tariff in the four months since the inquiry was completed.

Moreover, consumers feel their energy suppliers have a big role to play here. Nearly nine in ten (86%) people said they think it is the energy companies' responsibility to help customers better understand their energy usage and nine in ten (89%) say it is the energy companies responsibility to make sure they adequately understand their bill.

So, what is needed? Energy companies must prove they are taking action to genuinely engage with their customers stuck on the worst deals.

They must learn from the failed attempts to engage with their customers in the past. Clearly, few of these measures were effectively trialed or tested with consumers and therefore failed to engage those stuck on the worst deals, which were left paying over the odds for their energy.
This is an opportunity for the sector to demonstrate it is proactively working to fix the market. If it fails to do so, then the Government and the regulator must be ready to act.
 
Our ‘Fair Energy Prices’ campaign is challenging the energy companies to publish plans by 31st January 2017 and take immediate action this winter to deliver against these plans.

We will be keeping a close eye on the energy companies throughout the winter, publishing a scorecard to track the responses from the energy companies. We want to see immediate action taken to help customers who are paying more than they need to on their energy bills.    

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