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 08 August 2007
Confident Consumers - A Fair Deal creating Prosperity & Success for All
 
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Issues for Consumers in the Competitive Supply Market

Competition has had some adverse effects, particularly mis-selling and erroneous transfer of supply.  The complexities of the competitive market have also tended to exacerbate long-standing problems surrounding meter-reading and billing. 

Mis-selling

During 2001/2, DTI, with OFGEM and Energywatch, was instrumental in addressing mis-selling.  Suppliers agreed a Code of Practice that set out minimum standards (including the automatic payment of compensation in the event of fraud) and introduced the EnergySure scheme for the training and oversight of sales staff.  Since 2002, mis-selling complaints to Energywatch have declined steeply from 2,000 per month to 100.  The suppliers' trade association, the Energy Retail Association, now administers the Code and EnergySure. 

Customer transfers

In 2003, at the instigation of DTI, OFGEM and Energywatch, suppliers began work to improve transfer processes and reduce erroneous transfers and needless delays in switching.  This major programme will be completed in March 2006, but complaints in these areas have already declined significantly as a result of the focus on the problems.

Billing and metering

Billing and metering now constitute the largest bloc of complaints to Energywatch - around 40,000 in 2005/6.  In March 2005, Energywatch made a supercomplaint to OFGEM about suppliers' billing practices.  In response, OFGEM reduced the period within which suppliers could back-bill customers, and required suppliers to introduce a Billing Code of Practice on billing and an ombudsman scheme to resolve difficult complaints.  These new arrangements should be in place by July 2006. 

Debt and disconnections

Gas and electricity suppliers have the right, as a last resort, to disconnect customers who persistently refuse to pay bills.  During 2004, at the instigation of DTI and OFGEM, suppliers put in place new arrangements to protect vulnerable customers.  These should ensure that, as far as possible, no vulnerable customer is disconnected.  Since these measures were put in place, all disconnections have sharply declined.      

Details of industry measures in these areas can be found on the Energy Retail Association website (see External Links).

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