Half of consumers want whole market energy cap
Price regulation popular despite three quarters saying their bills are not unfair
Over half of consumers believe energy bills should be capped for all, new research has revealed.
In a survey of over 1,000 UK adults, conducted by Utility Week in partnership with Harris Interactive, 51 per cent of respondents said energy bills should be capped for everyone “because energy companies can’t be trusted not to rip people off”.
A further 24 per cent said they would welcome a cap, but only for vulnerable customers who struggle to pay their bills.
The finding follows a proposal from Ofgem to introduce a “safeguard tariff” which would extend the consumer protections currently applied to prepayment meter customers, to a wider vulnerable customer group.
The regulator is due to begin consulting on exactly how to define this group, and how to strucutre the cap, in the coming weeks.
Ofgem’s proposal met with stiff criticism in parliament where MPs said the regulator could go “much further” to act against what has been described as “abusive” charging.
Energy secretary Greg Clark has insisted he remains ready to legislate for a more rigorous price cap if Ofgem’s negotiations with the market produce a remedy government feels is not reflective of consumer detriment issues.
Following a two-year investigation into the energy market, the Competition and Markets Authority last year found that customers are being overcharged for their energy by £1.4bn a year. The figure has been energetically disputed by retailers and prominent industry figures, including former regulator Stephen Littlechild.
It is notable that respondents to Utility Week’s research advocated price regulation, even though 75 per cent said they did not feel they were charged an unfair amount for their energy.
Around a third (34 per cent) said they felt their charge was a fair reflection of the services they use and 40 per cent said they did not feel their charges were unfair, though, ideally they would like to have lower bills.
Other findings from Utility Week’s research show that 42 per cent of consumers would be in favour of renationalising the energy and water industries, with 20 per cent saying they “strongly agree” with the idea.
When asked what improvements they would like to see in the way their energy bills are presented, the most desired feature was increased clarity over the contributing costs, and why they are included – 49 per cent said they would appreciate this.
The second most appealing feature was better personal advice on how to save money – either by moving tariff or by changing behaviours.
The research also surveyed consumers on their views about water companies and revealed that over half of respondents would welcome competition in the domestic water market.