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What would make you trust energy companies?

High price for energy and gasoline in a news article headline

We’ve seen price rise announcements from four of the Big Six energy suppliers – unsurprisingly the reaction has been resoundingly negative. In fact, our research shows trust in energy suppliers has hit rock bottom.

Consumer trust in the energy industry has plummeted to a new low.

Just one in seven people say they trust energy companies to act in their best interest – the lowest since our Consumer Insight Tracker launched in July 2012. This compares to one in four before the price rises were announced.

Low trust in the energy industry

In fact, energy is now the most distrusted of all consumer industry sectors (59%), lower than banking (33%), car salesmen (55%) and train companies (27%).

Which? Convo commenter Charlie isn’t surprised, telling us:

‘I don’t trust energy companies to act in my best interest. But then they are private companies and are interested, primarily, in generating profit. Can we expect them to put the customer first without a strong regulatory body to ensure they do?’

Chris had harsh words for the energy companies and the government too:

‘The whole stinking corrupt setup is a national disgrace which will kill people and our Government just sits there playing with itself and only offering “helpful” advice like put on another jumper or switch to an equally expensive alternative supplier. Rubbish.’

Take action on energy bills

We’ve also found that the number of people worrying about energy prices has rocketed. Energy is now top of the list of consumer worries – eight in ten people are worried about energy prices, the highest this has been since October last year.

What we’ve heard from the Government so far is too little, too late – we need to see radical changes now. This is why we’re calling on the Chancellor to stand up for consumers when he delivers his Autumn Statement on 4 December.

George Osborne should cut the Big Six down to size to get competition into the market, and the cost of government energy policies should be cut back too. You can help by signing our petition, like Beryl has:

‘Time for action NOW. The debate has gone on long enough. It’s now up to George O to break the deadlock before the winter sets in so keep the campaign going Which?’

Do you trust energy companies to work in your best interest? Do you think we need to see radical action to fix the energy market?

Do you trust energy companies to act in your best interest?

No (97%, 2,139 Votes)

Don't know (2%, 45 Votes)

Yes (1%, 30 Votes)

Total Voters: 2,214

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Comments

To have any trust in the energy companies I believe requires trust in independent analysis of their performance. That means trusting the competence and intentions of the regulator – Ofgem. They issue regular information – the last of importance to domestic consumers being the Retail Market Review, setting out particularly its recommendations on charging models for energy.

Today, they have issued the following documens, essentially attempting to explain the financial affairs of the Big 6 energy suppliers in both energy supply and generation.

I would not pretend to be able to assess whether these documents really deal with the issues satisfactorily, but Which? could. I hope they will do so in an impartial way – forgetting their own preconceptions about this market – and present us with an unbiassed analysis as to whether profits are fair or not, assuming the relevant information is contained within these documents.

Incidentally, since the smaller energy suppliers do not seem to offer generally cheaper deals than the Big 6, would it not be interesting to examine their profits also?

Sorry the links are so lengthy! If you want to examine them just copy and paste into your browser. The documents are:

Revenue, costs and profits:
https://www.ofgem.gov.uk/publications-and-updates/revenues-costs-and-profits-large-energy-companies-2012?utm_source=Ofgem+Website+Mailing+List&utm_campaign=c9b8b695f2-Ofgem_Email_Alert11_25_2013&utm_medium=email&utm_term=0_a9e586c268-c9b8b695f2-395487641

Understand their profits:
https://www.ofgem.gov.uk/electricity/retail-market/monitoring-data-and-statistics/understanding-profits-big-energy-suppliers?utm_source=Ofgem+Website+Mailing+List&utm_campaign=c9b8b695f2-Ofgem_Email_Alert11_25_2013&utm_medium=email&utm_term=0_a9e586c268-c9b8b695f2-395487641

Letter about monitoring energy companies:
https://www.ofgem.gov.uk/publications-and-updates/letter-ofgem-oft-and-cma-secretary-state-competition-energy-markets?utm_source=Ofgem+Website+Mailing+List&utm_campaign=c9b8b695f2-Ofgem_Email_Alert11_25_2013&utm_medium=email&utm_term=0_a9e586c268-c9b8b695f2-395487641

Having read through the reports submitted by Malcolm R (which I found very informative but somewhat inconclusive) leads me to believe Ofgem are at last showing signs of bowing down to public pressure but we have to wait until March 2014 for the results of a full and comprehensive assessment! At a Selective Committee meeting held this week Ofgem Interim CEO asserted rather ambiguously “There was no evidence of anything untoward but we can’t rule it out .” There was no evidence of limiting profits in order to prevent the possibility of a Windfall Tax and Co’s were not obligated to disclose their international trading profits. It would appear there is still much work yet to be done!
I agree Ofgem should wholly investigate the energy market including the smaller Co’s if competition is to be restored.