By Daniel Hunter
A milestone has been reached in a campaign being waged to make business energy bills fairer, with several suppliers agreeing to adopt improvements to their customer communications.
The Contract End Date (CED) campaign - supported by over a thousand businesses and charities - calls for measures to make reviewing energy rates easier:
· Printing CEDs on bills along with notice periods required to terminate
· Renewal letters sent by Recorded Delivery
· Renewal letters showing the difference between the current rates charged and the proposed renewal rates in £s & % - as well as notice periods required to terminate.
This, it is argued, will lead to greater awareness of important deadlines, making it easier to switch supplier - or negotiate with existing ones - and result in more businesses/charities doing so.
Most receptive to the campaign among energy suppliers is CNG, which will be introducing CEDs on bills and sending renewal letters to customers by Recorded Delivery as soon as August. Those suppliers among the ‘Big Six’ agreeing to put CEDs on bills in future include E.ON, which is also exploring other options to improve customer communications; including the use of reminder letters following the initial renewal offer. Meanwhile, Scottish Power is already sending renewal letters to some of its business customers by Recorded Delivery.
Leading the campaign is business cost saving service, Make It Cheaper, which says that energy bills for organisations missing their deadlines are 30% higher than for those that successfully switch. This equates to a total annual overspend of £2 billion* across all businesses and charities in the UK. High renewal rates for gas and electricity contracts have long been the cause of angst for businesses and charities, not least because the bill payers often find themselves unknowingly tied into new rates before the old ones expire, preventing them from switching.
Jonathan Elliott, managing director of Make It Cheaper, explained: “Poor customer engagement is by far the biggest issue with four out of five businesses simply overlooking their renewal offers and left in the dark over if/how/when they can switch. So it’s fantastic news that the suppliers have listened to those concerns and are prepared to make changes. It will be interesting to see how quickly those changes happen and the impact they’ll have on the competitiveness of prices being offered.”
To date the campaign has received:
· 330 written requests to Ofgem from business energy customers for CEDs to be put on bills, in response to the Regulator’s Retail Market Review consultation1
· 716 signatures on an HM Government ePetition2
· 1,194 out of 1,248 (95.7%) survey respondents agreeing that it would be easier to manage their business energy contracts if CEDs appeared on every bill3
CNG managing director, Jacqui Hall, commented: “CNG is embracing the opportunity to represent independent energy suppliers in the pioneering bid to promote greater competition and better, more accurate communication between energy providers and customers. Delivering clear, concise information at regular intervals to our customers on their notice period and contract end date will empower them to seek out the best deal for their needs at any one time and overall, this move will increase accountability and credibility in this industry. As an energy supplier outside of the ‘Big Six’ this move is a vital step to developing the most competitive offering and providing customers with the most rounded view of services on offer; in effect, giving us a much louder voice.”
Anthony Ainsworth, sales director at E.ON, addded: “Our small business customers want clearer information about when their contract ends and the options they have at this point which is why we’ll be putting Contract End Dates on our bills by the end of the year. In January, we set out on a mission to reset our relationship with our customers and we're working very hard to understand and address the issues which really impact them, so that they can be confident that we're the best to do business with going forward. We’ll be making more changes over the coming months to ensure that the information we provide to customers is simple, open and transparently fair.”
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