The Competition and Markets Authority have today published their Summary of Provisional Findings(PDF, 615KB, 55 pages) in to the energy market.
The Competition and Markets Authority (CMA) began looking at the UK energy market in July 2014, after a referral by OFGEM which was concerned that competition was “not working as well as it should for consumers”.
The provisional finding’s paper highlighted a range of problems that are believed to be holding competition in the market back. The issues range from lack of consumer engagement to poor regulation.
The CMA’s carried out an extensive survey of 7,000 people across the UK and found:
• 34% had never considered switching energy supplier
• 36% either did not think it was possible or did know that if it was possible to change one (or more) of the following: tariff, payment method or supplier
• 56% had never switched supplier
• 72% said they never switched tariff with an existing supplier, did not know whether it was possible or did not know if they had done so.
As a result, the CMA believe that there is around 70% of consumers on a standard variable tariff. These customers are paying considerably more for their energy than those on a non-standard tariff.
CMA state that disengagement from customers has allowed energy suppliers to gain a position of unilateral market power concerning their inactive customer base and if these customers were to switch they could save (on average) £160 a year on their dual fuel bills.
Energy UK, which represents the major suppliers, argued that this was not an accusation that customers had been ripped off. Lawrence Slade, Chief Executive of Energy UK said of today’s findings: “Customers have not been overcharged but money may still be saved when people shop around for deals that suit their individual circumstances. There is greater choice for customers. It is easy to switch and a few minutes online could save households money and get them the deal that is right for them”.
Energylinx urges everyone to compare energy tariffs and ensure that you are not overpaying for your energy. This is a straight-forward process that will take less than 5 minutes and could save you a significant amount. You can do this online by clicking here. If you would rather speak with someone, one of our energy advisors are on hand to answer any questions you may have. Just call 0800 847 7077.
Energylinx welcome the findings and remedies recommended by the CMA and look forward to reading their final report in to the energy industry in December.