March 28, 2016
Citizens Advice have estimated that as many as 2.1 million households have been hit by large late gas and electricity bills in the last year, because energy suppliers have initially undercharged them.
The charity, which provides confidential information and advice to assist people with money, legal, consumer and other problems, made the estimate after surveying 2,000 people across the UK and found that 10% had been back-billed - where energy companies send a revised bill after undercharging.
On average the "catch up" amount was £206. Shockingly, 15% said they had been back-billed more that £250. In some case Citizens Advice seen cases of four figure sums being back-billed.
Energy suppliers can currently back-bill a customer for up to 12 months' worth of gas or electricity, even when it was the companies fault. Citizens Advice have said that in some cases customers can be back-billed for longer periods when the supplier argues the customer was at fault.
Billing errors are the biggest energy problem people contact Citizens Advice's consumer service about, with 16,000 cases seen last year.
Gillian Guy, Chief Executive of Citizens Advice, said:
"Customers shouldn't have to pay the price for suppliers' mistakes. Energy bills are already high so it adds insult to injury when companies go back to customers looking for more money after they got it wrong. Particularly for suppliers who insist on payment in full, this can be a huge burden on already stretched finances.
Smart meters provide a perfect opportunity to consign back-billing to the history books. As they are rolled out across the country OFGEM should ensure suppliers reduce the length of time they can back-bill customers."
Energy Secretary Amber Rudd said:
"This is very disappointing. I challenged the UK's biggest energy suppliers to bring down bills and pass on savings to consumers. They have dropped their prices which is a step in the right direction but errors on bills create unnecessary burdens and worry for hard-working people and I reiterate to all energy companies that they need to put their customers first and ensure that this does not happen.
We're installing smart meters to help people take control of their energy use and bring an end to estimated bills, as part of our plan to build a system of energy infrastructure fit for the 21st century."
Posted on March 28, 2016 at 12:33 PM
March 15, 2016
Citizens Advice have released their energy supplier table, with EDF Energy and SSE coming out on top. The table measures how effectively customer complaints are dealt with by the 19 biggest energy companies in the UK.
EDF Energy have narrowly taken the top spot for October to December 2015 by a margin of 0.4 points, replacing SSE who has been a permanent feature at the top of the table since it was published in its current format five years ago.
EDF Energy and SSE both have a ratio of less than 50 complaints per 100,000 customers, compared to ratio of more than 1,000 complaints per 100,000 customers for the worst performing suppliers, Extra Energy and Co-Operative Energy. Both of the worst performing companies have introduced new billing systems and the issues appear to have stemmed from there. Overall, the average complaints ratio for all companies is down with 275.2 registered per 100,000 customers, compared with 339 in the previous quarter.
Gillian Guy, Chief Executive of Citizens Advice, said: "The fallout from introducing new billing systems continues to trip up a number of suppliers.
This latest league table tells two different stories - some suppliers have again proven they're effective at dealing with customer complaints while others lag far behind. Consumers already pay over the odds for their energy bills and it's unacceptable that some are still being let down by poor customer service.
On the face of it, it is good the overall number of complaints are steadily decreasing. For those suppliers who still have a long way to go, there is an opportunity to learn from the feedback they are getting from their customers. Complaints not only give suppliers the chance to put problems right, they also provide valuable insight which can be used to improve services."
If you aren't happy with your energy supplier, you can switch to a new one. Energylinx provide an easy comparison and switching service and you can choose the supplier that you move to. Click here to be taken to out straightforward service.
Posted on March 15, 2016 at 03:59 PM
March 10, 2016
The Competition and Market Authority (CMA) have today released a report outlining remedies to address the problems holding back competition in the energy industry. The CMA will introduce these solutions following the conclusion of its investigation in June.
Does the energy market need to be more competitive?
Despite the increase in independent energy suppliers, providing competitively priced energy tariffs, 88% of UK households remain with the "Big Six" Energy suppliers; British Gas, EDF, E.ON, Npower, Scottish Power and SSE.
Around 70% of those customers are STILL on the more expensive 'default' Standard Variable Tariff and the CMA's latest analysis reveals that the potential savings for these customers has risen significantly over the past 2 years - with the average customer making a potential saving of over £300 by switching to a cheaper deal!
The CMA's analysis also shows that, in total, customers could have been paying about £1.7 billion a year more than they would in a competitive market.
The CMA have proposed different remedies it believes will make the energy market more competitive. These include:
OFGEM Controlled Database of Disengaged Customers
The CMA believe that the only consumers benefiting from competitive price plans are those that actively compare energy tariffs and switch supplier. As a result the CMA have suggested an OFGEM-controlled database which will allow rival suppliers to contact customers who have been stuck on their supplier's default tariff for 3 years or more with more competitive deals. This will be subject to strict safeguards so that customers can opt out at any time and to ensure that communication meets strictly controlled criteria.
This will be interesting to see in action and how it will actually work. It will hopefully benefit those customers who have never considered the financial benefits of switching energy supplier.
Goodbye Four Tariff Rule
Previously Energy Suppliers could have as many tariffs as they choose, then OFGEM decided that each supplier should be limited to four. To encourage competition, the CMA have said today the four tariff cap has been lifted.
Energylinx is delighted that after two years of investigation, that the CMA has decided to ditch the current rules where energy suppliers can only offer four tariffs. We believe that by allowing innovation in terms of number of tariffs and structures actually increases competition and TPIs remain well placed to provide the consumer with a one stop shop to compare and switch - taking advantage of the best energy tariffs for their home.
Price Cap for Prepayment Customers
Vulnerable customers will be protected from expensive tariffs under a new price cap on prepayment meter tariffs. Part of CMA's plans include a transitional price control for the 4 million households who are on prepayment meters and that face limited competition from suppliers. Prepayment customer's ability to switch and find better deals is also far more limited than that for credit and direct debit customers.
Energylinx is pleased to see that vulnerable customers are being provided with added protection with a new price cap arrangement planned for prepayment customers, as we are active supporters of the Citizens Advice "Fair Play to Prepay" Campaign.
The energy industry was referred to the CMA, by OFGEM, in June 2014. The final report is due in June 2016.
Over the course of the investigation to date, the CMA has commissioned and completed a general survey of 7,000 domestic customers; a further survey of over 1,200 domestic tenants and received over 200 submissions from energy suppliers, generators, government bodies, consumer groups, academics and other interested parties; held over 40 formal hearings with these parties; visited power plants and customer service offices in Scotland, England and Wales.
Posted on March 10, 2016 at 10:38 AM
March 4, 2016
Consumer group, Which? have asked regulators to make it easier for households to switch energy suppliers, claiming millions are paying up to £400 too much.
This is despite Energy Regulator, OFGEM, releasing figures last week that state the number of UK households switching their energy provider rose by 15% in 2015.
OFGEM say that 6.1m gas and electricity accounts had been transferred during the year - about 820,421 more than in 2014.
Although the figures show that competition in the market is improving, Which? Say that 71% of gas customers are on standard tariffs and 88% of households remained with the big six despite growth in smaller, independent suppliers - 37 firms in total, according to the Government.
Rachel Fletcher, OFGEM senior partner said:
"It's encouraging to see switching levels at their highest level for four years. With more than 30 suppliers active in the energy market and hundreds of pounds of savings to be made, it's a great opportunity to shop around."
Which? executive director Richard Lloyd said:
"Millions of people are still paying way over the odds for their energy, and levels of switching, while increasing, are still woefully low.
We would urge all consumers, especially those on a standard tariff with the Big Six, to switch to a cheaper deal today.
The stakes are high for the outcome of the energy market investigation and consumers will be expecting action to protect the most vulnerable and bring about fairer energy prices."
Which? Are right. Households throughout the UK would benefit from switching energy supplier. If you are on a Standard Tariff then you will be paying more than you have to for your energy. Seriously, check it out for yourself here. It's quick, easy and you could make a substantial saving.
Posted on March 4, 2016 at 03:28 PM