Today Ofgem announced plans to reform the energy retail market including introducing simpler standard tariffs.
The proposals include plans for a simple tariff for each supplier’s deal available – consisting of a daily standing charge set by the regulator and a unit charge set by t’e company.
Richard Lloyd, executive director of Which?, said: ‘This will help remove some of the complexity and confusion in the energy market that infuriates consumers.”
Although Which? welcomes the strong stance taken by the regulator, more could be done to make sure that all tariffs are simple and fair.
Richard Lloyd said: ‘We think a simple format should be applied across all tariffs, so that people can compare the full range of energy deals at a glance.’
You can help Which? lobby the regulator to make all tariffs simpler by joining the 5,000 people who have emailed Ofgem. These proposals will be consulted on later this year and there is still an opportunity to make sure that all tariffs are improved.
Simpler energy tariffs
Which? has been campaigning for simpler energy tariffs since September. We’d like to see a simple format for all tariffs – not just the standard tariffs – as it is currently extremely difficult for consumers to work out their energy bills.
In an investigation, Which? gave 36 people the ‘tariff test’ to see who could work out how much they should be paying for energy. Only one out of the 36 managed to calculate it correctly.
The Which? simple tariff
The Which? simple tariff would include a daily standing charge to cover the cost of getting energy to your door. This would be set by Ofgem at the lowest possible amount.
Energy companies would then offer a unit price on top of that including all discounts. This means that to find the best deal on energy, customers would just need to compare the unit prices.
We support Ofgem’s introduction of simplicity to standard tariffs, but they have left it open for suppliers to add extra tariffs with offers such as ‘free energy’ and ‘£100 annual discount’ which make it almost impossible for customers to compare the actual value of the deal.
- Tackle terrible energy tariffs – email Ofgem
- Find out how Which? is campaigning for more affordable energy
- Are you on the right tariff? Find out with Which? Switch