Customers

Suppliers reveal plans to improve energy customer engagement

EDF is the only member of the big six not to have responded to a Which? campaign to improve transparency around supplier customer engagement plans.

The consumer watchdog launched its Fair Energy Prices campaign following the conclusion of the Competition and Markets Authority (CMA) probe into energy market failings.

It challenged energy suppliers to voluntarily submit details of their plans to improve customer engagement, which the CMA identified as problematic. It said suppliers need to work harder to show customers the benefits of switching.

Which? contacted every supplier with more than 250,000 customers – which accounts for 19 companies – to obtain their engagement plans.

In total, 14 suppliers responded to this call, including five of the so called big six. EDF was the only one of the group not to provide details.

Amongst the companies that provided details of their plans, British Gas told Which? that it is trialling simple bill formats. Based on the feedback from this exercise, British Gas plans to roll out new style bills in 2018. 

Npower meanwhile said it will offer free energy health checks and support with fuel conservation measures to 20,000 customers paying above average heating bills.

In its customer engagement plan, challenger supplier Octopus Energy provided details of its recent marketing drive to persuade customers to switch from SVTs to fixed rate deals.

While 25 per cent of the 6,000 customers contacted by Octopus opened emails providing information about how to switch, only 2 per cent actually did so, according to Octopus’ submission.

Commenting on the plans, Alex Neill, Which? managing director of home and legal services, said: “With energy prices remaining a top worry for consumers, all companies must do more to engage with their customers and make it easier to switch to better deals. It’s now up to the government and regulator to hold them to account and ensure that they deliver on promises to help hard pressed energy customers.”

A Which? spokeswoman added that the organisation was “broadly happy” with the level of response it had received to its request for engagement plans.

Explaining its decision not to submit its engagement plan to Which? EDF stated that encouraging customers to switch could be better achieved via a cross-industry engagement strategy, rather than getting individual companies to set out their own plans.

It said: “We already see huge disparity in the number of customers on fixed tariffs across the suppliers, and individual plans will just continue to perpetuate the status quo.” 

An EDF spokesperson also told Utility Week that EDF has “done more than most already” to promote enegagement. The firm pointed out that 44 per cent of its custoemr are on fixed rate tariffs, one of the highest percentages among larger suppliers.

All suppliers who submitted information to Which? also promised to share the results of engagement trials due to be carried out this summer at Ofgem’s request.

In addition to asking suppliers to clarify their approaches to increased customer engagement, the Which? Fair Energy Prices campaign conducted analysis of Ofgem switching data. 

This found that two thirds of energy customers are locked into standard variable tariffs (SVT) or prepayment meter deals. It also found that the gap between the average SVT offered by the big six companies and the cheapest dual fuel deal on the market, as of last Friday, was £235 a year.

The campaign said the average big six SVT was £1069, while the cheapest deal on the market was £834. This deal is the Flex4 12 month fixed deal offered by IRESA Limited.