As another winter of inflation-busting energy price hikes bite, how do you feel about your supplier? Are they top of your Christmas card list? I very much doubt it!
When it comes to trust, the energy industry has just dropped to an all time low. More than half (54%) of the public now say they don’t trust energy companies, putting them second only to car salesmen in the low trust stakes.
It’s no surprise that people feel like that when you look in more depth at the recent price rises. You’ll have seen the recent headlines announcing average increases of 7, 8 or 9% depending on which supplier you’re with. But actually, where you live and how much energy you use could mean that you’re facing a much bigger increase in your monthly bill.
Take SSE customers in the North East. If they’re on the standard dual-fuel tariff, paying by cash and are also low-energy users, they are facing a whopping 17.15% rise for their electricity. Or think about Npower customers in northern Scotland. Low-energy users who pay by direct debit are facing a 15.91% price hike for their electricity, rather than the 9% average.
It doesn’t have to be like this. Steps can be taken by the government to make competition in the energy market work and keep prices in check. And following the Prime Minister’s commitment in October to force energy companies to move people on to their cheapest tariff, we’ve finally got an opportunity to make this happen.
Single unit price for energy
However, this requires the government to go a step further with its proposals and introduce a single unit price for energy. This will ensure that prices can be easily compared at a glance, like on petrol forecourt displays, allowing people to find the cheapest deals with ease.
Why is this so important? Well, prices will only be kept as low as possible if there is more effective competition between suppliers in the energy market. And there will only be price competition if people can compare their current deal against other offers and easily switch. As things stand, the Prime Minister’s promise should help you get the best price from your existing energy supplier. His promise does not guarantee the cheapest price on the market or a fair price.
And what about switching? We know that some people have found the process frustrating and time-consuming when it comes to moving to another tariff. Switching must be made quicker and easier.
This is why Which? has set out how this can be achieved in a new report called ‘The Imbalance of Power’. Call it our Christmas present to the government and the energy suppliers to help them sort out our broken energy market.
Let’s hope they read it over the holidays and come back in the New Year resolved to ensure that we all get a fairer deal.