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We ask the big energy players: what’s your biggest concern?

Because it’s Big Energy Week, we’ve asked key organisations, charities and energy companies what they think is the biggest problem in the energy market today. What will you make of their responses?

Not unexpectedly, their answers show a recurrence of the familiar themes we’ve talked about here on Which? Conversation, such as cost, complex tariffs and low trust in energy companies.

Energy prices rose a whopping 63% between 2000 and 2010, so it’s no wonder cost is a big issue for people. And as prices rise, it becomes harder for people to afford to heat their homes.

The rising cost of energy

Age UK’s charity director, Michelle Mitchell, picked out energy costs as her big concern:

‘The latest estimates show that there are now over 4.8 million older people of over 60 years of age who are fuel poor. These people are facing serious pressures on their meagre household budgets and are too often being faced with the choice of heating their homes or eating.’

Friends of the Earth agreed. Its senior energy campaigner, Paul Steedman, told us:

‘The yo-yoing price of gas, used for heating and to produce nearly half Britain’s electricity, has left families unable to plan their budgets.’

Complex tariffs and unclear bills

But it’s not just cost that means people are paying more than they should. Complex tariffs and unclear bills make it harder for people to know the true cost of their energy, which in turn makes it harder for them to choose a better tariff.

Ofgem’s Ian Marlee explained what Ofgem is doing to simplify energy tariffs:

‘Our review of the retail market found competition is being stifled by tariff complexity – which puts people off switching – as well as a lack of transparency and poor behaviour by suppliers.

‘We are proposing simpler tariffs so people can compare more easily to find the best deal for them; new rules to improve bills and annual statements; and tougher standards of conduct.’

While this is good, we think more should be done to tackle confusing tariffs. And Gillian Guy, Citizens Advice’s chief executive, agrees:

‘To reduce confusion around tariffs energy suppliers need to make choosing the right tariff easier, and it’s vital they tell customers about the best deal available to them and promote all the help that is at hand. At the Energy Summit last year, energy companies committed to making this happen and we’re determined to see that it does.’

What does the energy industry think?

Energy UK, the umbrella body for all the energy companies, raised the problem of energy security as well as cost. But it’s not just what the energy industry can do can do, Energy UK explains that we can all make changes to help reduce our energy usage:

‘The key challenge is how to ensure we have the energy supplies that the UK needs, while keeping prices affordable for consumers and also ensuring a successful transition to a low carbon economy. Making our homes more energy efficient could be crucial to keeping our bills as low as possible while meeting the challenges ahead.’

We didn’t stop there – we’ve asked lots of other energy companies, charities and organisations about their big energy concerns. We’ll be posting their responses in the comments below.

So, now you’ve heard from them, it’s over to you – what do you think is the biggest problem in the energy market? And what can charities, energy companies and the government do to fix it?

Comments
Profile photo of Switch Gas & Electric
Member

“The biggest problem for domestic customers in the energy market today is knowledge. In order for this to improve more transparency and simplicity is required.

It needs to be easier for customers to know what tariff they are currently on, including information on expiry dates and cancellation charges to provide empowerment for customers to switch to a cheaper energy tariff. The range of energy tariffs available to customers needs to be more streamlined to facilitate choice. Confidence in energy switching needs to improve so that more homes can benefit from cheaper energy tariffs.”

Sally Hill
CEO, Switch Gas and Electric Ltd

Profile photo of Confused.com
Member

Here at Confused.com we believe the biggest problem in the energy market today is the lack of consumer confidence. Consumers simply don’t trust the energy companies, and work needs to be done to rebuild the trust. Part of the problem stems from the market being overly complicated, but it’s also due to the constant raising and lowering of prices due to our reliance on wholesale gas prices. Consumers need to feel they’re being treated fairly, and unfortunately there’s some way to go before we achieve this.

Lisa Greenfield
Energy Product Analyst, Confused.com

Profile photo of E.ON
Member

“The biggest problem for consumers today is the cost of energy. We all need to look more closely at our energy consumption however it’s clear some consumers don’t understand why their prices are rising and that they can do something to take control of their bills. As Big Energy Week shows, we are able to provide support in many cases, however too many customers don’t trust us to help them. That’s why we’ve launched our Reset Review to look at how we supply, support and sell so that we can rebuild customer trust and help them to control their bills.”

Tony Cocker
CEO, E.ON UK

Profile photo of wavechange
Member

Tony – Thanks for responding to the fall in energy prices by announcing a decrease in prices in February. The clarity of e.on billing is exemplary and attending to the issues mentioned below would be a great help to customers.

– Either put a stop to the practice of keeping many customers’ in credit by hundreds of pounds or pay interest on credit balances.

– Use a geographical phone number for Customer Services, which would be cheaper for many customers.

– Provide an email address for Customer Services instead of a Web-based form or at least provide the facility to copy messages to the customer’s email account.

Member
Sandra says:
22 January 2012

Mr. Crocker . People are finding EON a dreadful company to be with ! How can someone signing up to you a couple of months ago at direst debit of £58 per month suddenly be asked for £128 per month ?!!! This, when on the reverse of the letter you have an estimated forecast of energy usage over the next 12 months equating to £58 per month !!! Your service is a complete joke . You can ring up three times for quotes and get three completely different amounts !

Why no help for those on the very lowest income households ?
the energy industry in this country is scandalous .

Profile photo of E.ON
Member

Hi @wavechange, great points and these are all things that we are looking at as part of our Reset Review. Please do get involved and help us improve. You can find out more online here: http://www.eonenergy.com/At-Home/Reset/

Anne, E.ON

Profile photo of E.ON
Member

Hi @Sandra, Thanks for bringing this example to our attention. This isn’t good, we don’t want to let customers down. We’ve made some initial changes to how we manage Direct Debit payments so that this is fairer for customers, and we’re looking at further changes as part of our Reset Review.

If you need help with your account then please get in touch – if you’re on Twitter you can tweet @EONhelp #eonhelp. There’s lots of help available for low income households, your energy provider or groups like Citizens Advice can help. These are all things that we’re looking at as part of our Reset Review, so please do get involved http://www.eonenergy.com/At-Home/Reset/

Anne, E.ON

Member
hmp says:
21 May 2017

one of the worst companies to deal with ok and in serious issues and what is mentioned on here is correct please contact ok thanks asap.

why cant we be treated like humans and treated like fools ok and the whole industry needs an over hall thanks please advice thanks.

the markets needs to be fixed and even a mayor of london and the elections needs to concetrate on this now asap.

Profile photo of uSwitch
Member

“The biggest problem facing the energy market today is how to secure our energy future at the price which is affordable while enabling British business to remain competitive. Prices have rocketed in the last 18 months, but with a quarter of our generation having to be replaced in the next 10 years and investment in the infrastructure needed, bills are only going to increase. It is important that the Government does two things; ensure that the investment is kept as low as possible while meeting our climate change obligations and look at the impact on households least able to pay higher energy costs and develop a strategy to support people in greatest need.”

Ann Robinson
Director of Consumer Policy at uSwitch.com

Profile photo of Consumer Focus
Member

The biggest problem in the energy market today is very simple. The cost of energy has been rising for a number of years and may keep going up for some time.

When the global economy picks up, demand for energy will increase and so may prices. We have to invest billions to renew and decarbonise our electricity supply. The consumer will pay for all this.

We may not be able to keep prices low, but we need to keep prices fair and equitable, and protect those who are least able to pay. Big Energy Week is a great idea. But we have to prepare for a Big Energy Decade.

Mike O’Connor
Chief Executive of Consumer Focus

Profile photo of EDF Energy
Member

The crucial challenge will be rebuilding the relationship between the industry and consumers. We must invest billions of pounds to meet the UK’s need for affordable, low-carbon and secure energy. For that, it is vital customers can trust their energy company. Our customers want fair, clear and transparent prices, more than anything else. That is why we are the first major supplier to announce a price cut in 2012 and the last to increase prices in 2010. It is why we have had the cheapest standard prices on average for two winters. We are committed to providing a fair deal.

Profile photo of Scottish Power
Member

We want to encourage open and honest discussion about energy in the UK. There is cross-party political support the reduction of carbon emissions through the development of green energy generation, which will reduce the UK’s dependence on fossil fuels and their fluctuating markets. We need to work with Government to find the solutions, and we need to be honest about the scale and costs of meeting these challenges. The challenges are considerable – estimates put the cost to decarbonise and modernise the UK energy system at £200bn. This includes replacing old power plants and developing renewable and nuclear generation as well as redeveloping our grid network by 2020. But there is also much to be gained: investment in the electricity network and low carbon generation will create high quality long-term jobs and offer real opportunities for UK manufacturing and engineering companies.

Keith Anderson
Chief Corporate Officer at ScottishPower

Profile photo of SSE
Member

The biggest problem in the energy market today is trust. The increased cost we have to pay to secure energy and transport it to customers’ homes has meant that energy is a very significant purchase for most people. With any significant outlay, customers have to be confident that they are getting a fair deal. Up until now, suppliers have not been as transparent with customers as they should have been, and they have lost trust. We have taken steps to begin to address this – let us know what you think and tell us what more we can do.

Tony Keeling
SSE’s Director of Customer Service

Profile photo of moneysupermarket
Member

MoneySupermarket comments on the biggest problems in the energy market today:

“Lack of help, advice and transparency are the biggest problems for energy customers in the UK. There is little information about the way bills are structured and not a lot of guidance on products and tariffs available, this is a big barrier to switching and hampers people who are actively trying to get a better deal on their energy. Not knowing what help is available for those struggling to pay their bills is leaving many consumers angry and frustrated. More clarity over access to social tariffs and the support on offer would be really welcome to help those in fuel poverty.”

Profile photo of npower
Member

There are many big issues within the energy industry at the moment, but if I was to choose one it would be ‘trust’, We have lost the trust of our customers and we need to win it back and encourage our customers to talk to us. There is a lot we can do to help them and we can start to address any other problems they may have, whether those relate to billing, meter reads, energy efficiency or being on the right tariff .

Paul Massara, chief commercial officer RWE npower

Profile photo of william
Member

My biggest concern is why do these energy companies employ buyers who only ever stockpile prior to a big price drop and never before a price rise.

Profile photo of optima energy
Member

We would agree that there needs to be more transparency across the energy industry as a whole. Consumers need to have more knowledge of the tariffs they are on and have better awareness of what is available to them – but we would also add that the consumer is very ill-informed about the fundamentals that drive energy prices – and this is vital when making decisions such as whether to opt for a fixed or variable product plan. Whilst price comparison websites do go some way to helping consumers choose the best tariff to go on, they don’t provide information on whether it is best to opt for a fixed or variable rate.

There has been little media coverage of the fact that wholesale electricity prices have fallen by approximately 25% in the last six months alone. If consumers were aware of this, they may have opted not to fix. The ‘Big Six’ are in a tricky position, as they have to purchase a large amount of their energy in advance, so can’t always pass on falls in wholesale prices to the consumer straight away – but it doesn’t help when suppliers ‘offer’ fixed prices for 12 months, knowing they will be reducing their standard tariffs well before the end of that period.

Optima Energy Management
@Optima_Services

Profile photo of daver22
Member

Sorry I just don’t go along with all this claptrap, there is one network infrastructure which supplies homes and businesses in the UK.

The idea that you need to purchase these supplies in advance is a load of tosh, just make sure that there is sufficient generation capacity in the UK to supply the UK, use a Smart Meter to monitor the electricity taken from each utility supplier.

You can then send them the correct amount for the electricity supplied.

If you want to try to force smart meters on the customer then you should be able to support the concept for yourselves.

Personally I cannot see how energy prices can rise if you have security of supply from UK sources – go on say it we don’t have the capacity – then bloody well build the capacity and stop meeting round a bloody table in Whitehall or wherever as by the time you have wiped your ….. there won’t be any UK based suppliers left.

I don’t want ‘open and honest discussion’ all I want is cheap reliable UK produced energy – GET ON WITH IT!

Profile photo of optima energy
Member

Although there is one UK network, we import and export to Europe and our energy costs are affected by global events and prices. Currently, supplies need to be purchased in advance, as even if we had enough UK capacity for all our energy requirements, the raw materials used to generate electricity / receive natural gas vary in price throughout the year – coal, oil etc.

Ultimately, we too want cheap, reliable, UK produced energy, with a large percentage of our baseload requirement coming from renewable sources – but this is going to take time and require investment.

Optima Energy Management
@Optima_Services

Member
Martin says:
20 January 2012

The current crop of smart meters are not that smart and don’t show live data. The Utilities dont want us to have accurate readings and be able to alter usage for ourselves because they make a fortune on estimates. There are products that can show gas, water and electricity readings “live” so why are they not being fitted to all council buildings, housing associations and anywhere funded by the taxpayer?

Profile photo of daver22
Member

I venture to suggest that they haven’t yet worked out the specification through to reliable manufacture yet. I think they intend to start installation in 2014 and complete (100%) by 2020.

They will not manage that as it will be 100% -1 (Me).

Member
Susan says:
20 January 2012

This article states that energy supplies have risen 63% between 2000 and 2010 – yet these energy suppliers want us to be grateful for a 6% reduction on either gas/electricity (depending on who you get your energy from). A mere drop in the ocean. My pension has not gone up so how am I expected to pay these energy companies so I can keep warm and cook hot meals?

Profile photo of daver22
Member

Do the following;

1. Cook your meals

2. Heat your home

… Ignore the bills and when they arrest you point out it will cost more to jail you for a week than to let you have the energy for free. If enough pensioners did this they would have to rethink the whole energy marketplace as there wouldn’t be enough court time for everyone in the country.

JUST REVOLT

Member
lukky says:
20 January 2012

Think not what your energy company do for you ,..but what you can do for them,…ie; make them billions… it would be funny if it wasn’t so damn crooked/greedy/disgusting

Member
Alan Henness says:
21 January 2012

Several of the energy companies above have talked about ‘trust’.

Can you each tell us what you mean by that?

Member
Alan Henness says:
26 January 2012

Does no supplier want to answer my question?

Profile photo of ChrisGloucester
Member

The whole point of privatising energy suppliers was to promote competitive prices and good customer services. Trouble is all suppliers basically get energy from the same wholesaler and have very similar operating costs. So I would argue privatisation has not really achieved it’s objective.
I speak as a “serial switcher” who has enjoyed a better deal after switching but usually not for long. At the end of the day whoever you buy it from pricewise there ain’t much in it over the medium to longer term so long as you’ve sorted out the tariff jungle and found the best tariff format for you.
Given this is the situation it’s understandable that consumers accuse the big six of operating a cartel. It often looks like they are even if they’re not.
Personally I’d say there is a case for re-nationalising energy supply on the basis that competition is not really happening and supply companies are forced to run at a profit to satisfy shareholders.
A nationalised network with a strong overseeing watchdog body to ensure efficiency could offer the consumer a better deal, if only in that the pressure to run at ever increasing profit would be removed.

Member
Anthony cory says:
22 January 2012

As there is no competition at all between the power company’s , they should ALL be re-nationaiized

Member
Susan - Co. Durham says:
26 January 2012

As a consumer who went through switching suppliers almost as soon as it became possible, I suffered double billing and never ending disputes about who my supplier really was and to be honest, it put me off shopping around for the best tariffs for quite some time.
Assured that the process was more transparent and streamlined than ever, I started to shop around again within the last two to three years.
I am cynically curious to understand why the big providers never seem to bulk buy when prices are low and then expect consumers to be sympathetic to them when they tell us ‘they have no choice’ but to raise our energy bills.
I am annoyed about the lack of consistency in charging. When the suppliers want your business they always ask things like how much you are paying now, how big your house is, how many people live there and the biggy How much are you paying etc etc, but when you try to leave them they warn you about competitors charging not being what it appears to be and should always go by actual consumption with so many units being charge at multiple decimal points of a penny per miniscule of a Kilowatt.
I’m all for reversing the market and giving consumers’ real power to choose.
As a consultant, I am aware of the call centre industry and how it works, systems they use and some of the issues they have around staffing, training, attrition – and the additional costs they incur as a result of it. I think the following would remedy unnecessary calls being generated, staff being able to deal with customers properly, a reduction in providers operating costs, improved staff morale, reduction in attrition/training costs and improved customer service……………Voila!
For example; I’m a consumer with a 4 bed house in which 3 adults live. We have a recently installed high efficiency rated combi boiler heating our house and have all the usual mod cons and gadgets associated with modern living, dishwasher, tumble drier, washing machine, multiple TV’s, games consoles, alarms etc etc. I would like to spend up to £120 per month for my gas and electricity supply, payable monthly in advance by direct debit and this price is to be fixed for one year.
I am happy at this point to receive all the offers from suppliers who want my business and who will guarantee me service for a maximum of £120 per month knowing that I will be reviewing my supply and expecting me to ask them to compete again in twelve months’ time. I would like the supplier who wins my business to do the courtesy of calling me within the termination notice period to advise me that my tariff is coming up for review and, that they would ideally like to keep me as their customer. I would also like the suppliers who didn’t win my business to give me a courtesy call within this period to declare that they would like the opportunity to win my business from their competitor for the next year.
I know your CRM systems have this capability, why don’t you use it. If I can remind you of the advantages to you as a provider………
Reduction in outgoing call costs/lines
Reduction in Staff Attrition
Reduction in Training as a result of reduction in attrition
Improved customer service
Improved staff morale
Reduction in complaints
And you will be running a far more efficient business!

Member
Susan - Co. Durham says:
26 January 2012

One last thing………
Silent calls – one provider (and the culprit is one of the first of the energy providers to comment on this link) persistently harrasses me with silent calls – 4 or 5 times a day!.
Your auto dialler appears to be being ‘mismanaged’ – assuming it’s to hit calls per day target or something of that ilk and you don’t have enough agents to pick up the calls it is generating (if you do have enough agents they’ve found a way to fudge their talk time – again assuming it a target related problem!) hence silent calls to me and however many hundreds or thousands customers who are harrassed in this way. Reduce your operating costs, manage your people and systems properly = happy staff, happy customers, happy days!