Ofgem has expressed concerns that the number of priority services register (PSR) services offered by energy suppliers seems to be “out of step with need”.
The regulator’s latest Consumer Protection Report draws upon the social obligations data from domestic suppliers, as well as engagement with consumer groups and charities over the course of the coronavirus pandemic.
It highlighted areas of both good and bad practice that it has observed across the market and Ofgem said it expects industry to respond to the findings and insights.
One of its main concerns relates to the use of PSRs. In 2020, there was a 2% increase of gas and electricity customers on PSRs compared to the previous year, with more than 7 million electricity customers and just under 6 million gas customers using the services.
However, there was a 15% reduction in the number of services for electricity and an 11% decrease for gas.
Ofgem said the numbers of services offered “seems to be out of step with need”. For example, data shows that third party billing/ bill redirection was one of the most commonly provided services in 2020, continuing a trend observed in the regulator’s previous report.
However, the regulator said this does not align with the number of people who require such services.
By way of example, it pointed to data from the Alzheimer’s Society which shows there are around 850,000 people with dementia in the UK, and this is projected to rise to 1.6 million by 2040. Yet Ofgem’s data indicates that only 14% of those living with dementia are accessing these services.
Similarly there are more than 2 million people in the UK living with sight loss. Yet according to the regulator’s data only 3% are utilising communication in accessible formats from their energy provider.
“We do note that not all people who have these vulnerable characteristics may need to access such services… The fact that the number of vulnerable customers who might need services is not in proportion to the observed amount accessing such services suggests there is more that suppliers could be doing to identify those that need support and offer assistance,” Ofgem said.
Ofgem additionally noted that while Covid saw the numbers on PSRs increase, there was no comparable increase in the number of customers using PSR services in relation to what it would expect in light of the pandemic. Furthermore, the number of vulnerable consumers signed up to suppliers’ PSR slowed compared with previous years.
Suppliers must be more proactive in identifying those who may benefit from PSR services, Ofgem said, expressing fears that this is not taking place effectively.
Meter reads
Ofgem added it was “particularly concerned” to see that in 2020 there had been a “significant reduction” in quarterly meter reads for customers on a PSR. Infrequent readings can lead to inaccurate billing and ‘bill shock’, potentially causing unnecessary stress and worry for consumers.
While acknowledging many suppliers proactively prompt customers to provide reads regularly and ensure people registered via the PSR receive these in a timely manner, the regulator was “disappointed” to see that this is not universal practice.
The report added: “The impact of Covid-19 and lockdown restrictions are likely to have prevented meter reading agents and engineers from visiting properties. However, if left unchecked by suppliers, customers could face a mounting debt balance, so we expect to see these areas prioritised in the coming months and to see numbers of meter reads rise again by our next report.”
Responding to the report, an Energy UK spokesperson said: “As the Ofgem report acknowledges, suppliers signed up to Energy UK’s Vulnerability Commitment have pledged to make it as easy as possible for their customers to access the support and information they need, which includes having a freephone number available as well as working to increase awareness of the PSR.
“Our forthcoming report will highlight best practice amongst signatories to the Vulnerability Commitment and feature initiatives suppliers have introduced to successfully increase the number of customers signing to the PSR.”