/ Home & Energy

Energy suppliers respond to our campaign – what do you think?

Energy deadline

31 January marked the deadline for energy suppliers to submit their plans to wake up their customers who are sat on standard variable tariffs. So what’s the score then?

Some of you will recall that after a full two-year long investigation by the Competition and Markets Authority (CMA), last summer the investigation finally concluded.

And it confirmed what we already knew – this market just simply isn’t working for consumers and it’s time for energy companies to accept they need to change.

Disengaged customers

The crux of problem is that, largely we, as consumers, just aren’t engaged with what’s going on with our energy.

And there could be a number of reasons why this is – such as, not knowing how to engage, difficulty understanding energy tariffs or bills, or just simply, a lack of trust in energy companies.

But, there’s a bigger problem here – and one that we’ve been campaigning on – that those who don’t engage are often the ones penalised for it. This comes in the form of paying out for standard variable tariffs or SVTs.

These tariffs are usually the most expensive tariffs on the market. Our research found that the gap between a SVT price paid with the Big Six is, on average, £111 more than their cheapest tariffs and over 58% of the Big Six’s energy customers are on these tariffs.

Well today, Which? was in Parliament giving evidence to the Business, Energy and Industrial Strategy parliamentary select committee, on what progress we’ve seen since the regulators published their energy market findings last summer.

And we certainly didn’t pull any punches…

Six months after the CMA’s inquiry concluded and energy prices topped the list of biggest consumer worries. What’s more, trust in the sector has continued to dwindle, and the Big Six energy suppliers also found themselves lumped into the bottom half of our annual energy customer satisfaction survey.

From our view, while we’ve seen Ofgem take on the challenge set, and start trialling and testing ways to improve the current situation with our energy, the same cannot be said of the industry.

Energy sector response

It seems that energy suppliers are dragging their feet and waiting to be told what to do by the government or the regulators, bringing into question their commitment to really making this a proper functioning, competitive market that works for its customers.

And that’s exactly why we’ve been calling on energy suppliers to submit plans that show how they are going to help their most disengaged customers, those on SVTs, get engaged and moving onto better deals.

The deadline we set for that challenge is today. We’ve allowed almost three months for energy suppliers to submit their plans – you can see who has responded to our calls on our energy campaign website.

So, after nearly three years of looking at the problems with our energy, we now want the energy sector to start being part of the solution. Their customers have been waiting far too long already.

Update 14 Feb 2017: Suppliers respond

Our latest analysis of Ofgem data reveals that two thirds of energy customers are still stuck on the most expensive deals. As part of our Fair Energy Prices campaign, we challenged energy suppliers to publish plans on how they’d get these customers engaged and switching.

We had 19 responses from energy suppliers and, of those, 14 set out plans to engage their customers, including trialling simpler bills and new ways to make people to switch. Here’s Which? Campaigns Manager Neena Bhati talking about these plans:

Energy prices remain a top worry for consumers, and with the recent price hikes it’s vital that all companies do more to engage with their customers and make it easier to switch to better deals.

We’ve passed all the plans to the government and Ofgem and have called on them to report on progress by the end of April. We’ll also be pressing suppliers to deliver on their plans, and to regularly set out what difference this is making to their customers.

Do you think the energy industry is doing enough for customers? Do you feel the industry works for you?

Comments

I have very low gas and electricity usage and feel very unfairly treated by the recent npower price hikes. It is absolute rubbish for them to say they know and understand their customers and what they want. Yes they know their customers and know how maximise profit from them, but that’s all. I will have a 34% price hike staying with them.

Malcolm, the obvious question is “why stay with them?”. Try Which?Switch to find a cheaper supplier. There are around 40 to choose from. You are lucky having low usage and correspondingly low bills. Some find Ebico, with no standing charge, to be good if you are a very low user.

regina luxemburg says:
20 February 2017

british gas seem the most reasonable to deal with in my opinion.very helpful and anxious to put you on their best deal for you.

regina luxemburg

I changed to Ovo several years ago and have been delighted. I only have electricity – day and night and my annual bill is about £400 p.a. Their website is really easy to use. I get really frustrated when companies say you could save £300 pounds, I wish!! Much better to quote the price per unit. How much you use depends on your property and many other factors. Ovo only have three tarrifs – dual fuel, day and night electric, and standard electric. Very easy to work out.

Those who are in debt on a prepayment meter seemingly have been able to transfer that debt to a new supplier to take advantage of a better tariff. The debt that can be transferred has been increased to £500. https://www.ofgem.gov.uk/system/files/docs/2017/02/dap_closedown_letter_final_20_feb_2017.pdf

Rod Northcott says:
21 February 2017

I left EDF for First Utility, I have found them efficient ,informative and ready to supply information as well as being one of the cheapest.When they think I should change tariff they have in the past told me about the better deal.

peter says:
21 February 2017

I left EDF three years ago for Ist Utility and I am so pleased that I did.

I was with Scottish Power, they kept upping their prices so I did a search of other companies and decided to go with First Utility.
They halved my monthly direct debit, then reduced it further. I now have a large credit balance to see me through the winter.
I told my friends, now they have joined.
An excellent company to deal with’

I Belcher says:
22 February 2017

I left Co-op energy after a disasterous change in their computer systems. Now with Extra Energy who reduced my bills by £800.
Just renewed with Extra Energy, saving another £300

I want the goverment to hold all companies to account , who do not do the best for their customer and give them proper service

I’m afraid to say that I don’t think this will make any difference to the way the energy companies behave; they will just look on this as a PR exercise and will carry on in their own sweet way!

I think your campaign has the wrong focus. If people really care how much they pay for energy, it is usually open to them to put the time and effort necessary to make the savings by switching: though it is not so easy for those who are not web users. The people who essentially can’t do that are those stuck on pre-payment meters where they will always be worse off than mainstream customers – it should be much easier to move to normal billing methods. The other major problem is that people in rented accommodation usually can’t get the places where they live made more energy efficient.

But that is changing from this April, Phil. Landlords will have to bring all rented properties that are subject to energy performance certificates up to a minimum E standard. It is being phased in starting with new lets and then extended as tenancies turn over. It’s not the most ambitious exercise but given where things are starting from it should bring about a noticeable improvement within a few years and, in the pursuit of higher rents, will push energy efficiency improvements up the rental market.

I moved from First Utility to npower in December because I was chasing the best fixed 1-year deal I could find. So far I am pleased with npower and their web site is easier to use than First Utility’s. I have just read npower’s response to the Which? complaint and their approach seems comprehensive in taking the problems of those who, for whatever reason won’t switch.
I was fairly happy with First Utility and their prices, but their response to problems was poor: I am still waiting for the final bill!

I usually switch each year with the help of Cheap Energy Club. It’s not difficult. I’ve just switched to Iresa.

My last bill from British gas indicated that I would be better off going with Sainsbury for energy. This I did and this is the type of help I would like from my energy supplier. Have found that British Gas is very helpful in all ways. Still prefer to having simple paper bills though so I can trace what is happening. It is easy to lose info in a computer

Sainsbury’s is a “white label” supplier; they effectively are an agent for another supplier. In this case that other supplier is British Gas. Sainsbury’s seem to offer competitive tariffs so it was good of BG to refer you to them. It could still be worthwhile you looking at Which?Switch to see if you could get a significantly better deal though, I would suggest.

Steve C. says:
26 February 2017

We have two supplies, one of which is three phase. Both were provided by EDF. Due to EDF’s latest price increase, we have just swapped the main (single phase) supply to Bulb, a 100 percent green supplier with – apparently – one of the best customer service records around. They certainly have been extremely helpful so far and are projected to save us around @£250 per year as well. Unfortunately, due to their expense daily standing charge, they could not be competitive with the three phase supply but they were very ‘up front’ and apologetic about that and did not say anything about what type of supply was involved. It would appear that new suppliers only need the supply details (address, possibly meter number etc.) to be able to switch. We are currently seeking an alternative supplier for this.

Ofgem today:
“Switching hit a six-year high last year as more households shopped around for a better deal.
7.7 million gas or electricity switches took place in 2016, according to new data from Ofgem. This is 1.7 million more switches than the previous year, a surge of 28%.
In this way, switching rates last year reached their highest level since 2010, at around 15.8% across gas and electricity customers.”

Perhaps the message is beginning to get through?

Switching suppliers costs money and that cost will be shared by everyone including those who do not switch, including the vulnerable.

I would prefer to tackle the problem that the way the industry works results in many paying more for their energy if they don’t regularly check to see if there is a cheaper alternative.

Until the basic problem has been tackled we will keep having these discussions. It’s time to think about people other than ourselves.

I have suggested that subsidised fixed term fixed price tariffs (if indeed they are) should be abolished and the basic tariff should be a standard variable one. There would then be less need to switch. However, there will always be differences between suppliers – the way the buy energy in the market, how far ahead they forward buy, how efficient their operation is…..so we will always have a price choice.

I am still waiting for Which? to comment on their stance on subsidised tariffs and whether they support svt’s as the main tariff – cheaper for all if subsidised tariffs were removed. Do you support this as part of the approach?

I’m with British Gas. Had lots of credit last year, but it’s vanished. What happens to that credit??

If you pay by direct debit you may have had an automatic refund to your bank account, Richard. Energy companies generally make refunds once a year unless you object to the accumulation of credit. I hope it’s not because you have landed on an expensive tariff because a fixed price one has ended.

My opinion is Ofgem are not doing enough to control the energy increases no matter which supplier you are with, a lot of talk not enough action.

I am trying to switch providers. I am confused I have two quotes for switching suppliers. One has a lower price for energy one a lower price for the standing charge. How is one supposed to work out which is cheaper?

Use your estimated annual consumption, in units (kWhours) of gas and electricity. Multiply each by its unit rate and add on the annual standing charge. Compare the two suppliers. Or you could simply ask the potential provider to quote your annual bill based on your usage – give the same usage to each, of course.

Alternatively, Which?Switch does this for you – put in your annual estimated usage and the quotes it produces give total annual cost including the unit rate and the standing charge. You can do this on line or give them a phone call.

I am now with Ovo for over a year and delighted with them.