Years of soaring energy prices and poor customer service have taken their toll on consumers across the country. With price hikes occurring on an annual basis, it is little wonder we feel disgruntled and disengaged.
These winters of discontent could well be numbered following this week’s announcement from Ofgem, which has referred the generation and retail energy industry to the Competition and Markets Authority (CMA) for investigation.
However, although we have every confidence in the CMA’s abilities to find a way for the energy market to work better for consumers, we may well have to wait up to two years for things to change. In the meantime, it is important that we look for solutions that will help reduce bills and improve customer service.
A competitive market will work for consumers, rather than against them. One of the main steps here is to put downward pressure on prices – take supermarkets, for example. Discount stores are creating huge competitive pressure, forcing their peers to up their game and improve customer service. Whether we’re talking about supermarkets or energy suppliers, these giants should be fighting to keep their customers. As consumers vote with their feet, companies who fail to respond will go out of business.
Another key element of competition is to encourage choice. This investigation should help to break down some of the barriers that new entrants face, and ensure smaller and more innovative suppliers are able to challenge some of the incumbents.
Although we need to look for answers that help consumers here and now, it is important that this investigation is carried out thoroughly, and all avenues are explored. It is yet to be seen what will come of this review, and the devil will be in the detail. Whatever the case, it is vital that consumers are placed at the heart of the investigation, and are left empowered by it.
Consumers who feel in control of their energy will be able to reduce the amount they use and lower their bills. There are initiatives already in place that will help – the changes made to the Green Deal will ensure funding is more accessible, for example. The main point for consumers to take away from this week’s announcement is that things are changing. But there is no need for them to wait until the investigation is complete to reduce their own bills. They can do that as early as today.
Ann Robinson is Director of Consumer Policy at uSwitch.com