Ofgem’s policy to address consumer standards went live on 14th December 2023 following years of declining customer satisfaction statistics from [both Ofgem and] Citizen’s Advice. Help for vulnerable customers is a clear priority, with the policy requiring Suppliers to proactively engage with Customers having difficulty paying their bills, delivering longer opening hours for enquiries, including both evenings and weekends, as well as providing around-the-clock emergency support for customers whose supply is cut off due to a fault with their meter.
An additional change is the requirement for Suppliers to publish information on customer service levels, given a lack of competition on price and switching. The Energy Price Cap was originally brought in to protect customers on Standard Variable Tariffs who chose not to switch Suppliers or update their tariffs, but more recently, it has effectively become the price set for all customers and contributed to the fall in switching levels, which are tracking at less than 50% of Q3 2021 figures (as detailed in the below diagram), a previous key indicator for market competitiveness. With Suppliers limited in their ability to compete on price, consumer standards could be a key metric in attempting to inform consumer choice.
“This chart shows the total number of domestic customers switching gas and electricity supplier each month. This is the number of switches that were completed during the whole month and the specific date given is not relevant; for example, figures labelled with 01/01/2021 relate to switches that were completed during the whole of January. It also shows the number of switches going from the large legacy suppliers to other large, medium and small suppliers, as well as the net gains made by these suppliers (from November 2016). These figures have had any additional ‘switches’ from Supplier of Last Resort processes and acquisitions removed to ensure accuracy.” Ofgem
These additional requirements could be viewed through the lens of most benefiting larger Suppliers, who have the economies of scale to implement these changes – if they aren’t meeting them already, and potentially place an extra burden on smaller Suppliers, specifically with regards to flexing their resource to accommodate longer working hours either through changes to their internal working patterns or increased relationships with 3rd parties.
What is clear is that Suppliers are required to know their customers better than ever to help turn around public perception of an industry bearing the brunt of the cost of living crisis. At Engage Consulting, we can help to ensure you have the correct channels in place to support vulnerable customers through:
- Mapping and critiquing your customer journeys
- Auditing existing policies and procedures
- Creating management information reporting
- Designing Key Performance Indicators
More information can be found on the Effective and Fair Bad Debt Management section of our website.