Ofgem has been urged to learn lessons from the water sector in its bid to reduce the c£3 billion energy customer debt pile.
Consumer group CCW has called on Ofgem to learn lessons from affordability and debt schemes run by water companies including Thames Water, Wessex and Severn Trent.
The group says there “are a number of areas where progress and learnings from the water sector could be usefully applied to energy”, in its response to Ofgem’s consultation on affordability and debt in the domestic retail market.
It adds: “Water companies offer a suite of options (beyond social tariffs) to help support customers facing a wide range of different circumstances, from those just about managing to those in debt across multiple household bills.
“Measures include payment breaks, benefit entitlement checks, water efficiency support, debt support schemes and financial hardship funds.”
Specifically, CCW backs the National Energy Action’s proposed “Help to Repay” scheme to support energy customers in debt.
It adds that the scheme is similar in its format to schemes run by most water companies to help customers clear arrears.
“Feedback from companies is that they find the schemes to be an incredibly useful tool in reestablishing engagement with struggling customers and in re-stablishing a regular pattern of payment from them,” it adds.
“Customers generally considered to be helpful to those needing support whilst incentivising them to continue to make payments at an affordable level. It is also felt that they demonstrate a caring and helpful attitude from the water company.”
The consumer group also cites three case studies which respectively make it easier to apply for support; engage with hard to reach vulnerable customers; and address affordability through water efficiency.
The first scheme, carried out by Wessex, examined what type of language and imagery to use in ensuring that application forms are easy to understand and complete.
“A key message was that applying for help should be a positive experience for customers and raising awareness of the assistance that is available remains the most important improvement that companies can make,” CCW adds.
In another pilot scheme Severn Trent experimented with ways to engage with communities by working with schools to inform children, so that they can influence adults water usage in their household.
Meanwhile, CCW also cites Thames Water’s Smarter Home Visits (SHVs) pilot which found home visits can reduce consumption levels of households identified as using higher levels of water.
The submission also repeats the group’s previous calls for a joined up, cross sector social tariff. It adds: “We believe a more joined up approach on social tariffs across water and energy sectors could prove powerful in ensuring those with the lowest incomes are protected from the risk of significant price fluctuations across their core essential services.”