Ofgem has launched its 12-week consultation on the Retail Market Review, but Which? is asking the government to step in, as Ofgem’s plans do not go far enough.
Ofgem’s consultation proposes that energy companies offer just one ‘standard’ energy tariff for each payment type. This tariff would be simple – a daily charge set by the regulator and a unit rate.
However, energy companies will still be free to confuse customers with ‘non-standard’ deals that include confusing pricing and complex discounts. Which? wants to see a simple tariff system across all energy tariffs – not just the standard deals.
Cheapest energy deal
Richard Lloyd, executive director of Which?, said: ‘Without more radical changes than those Ofgem is proposing, people will still struggle to compare different deals at a glance and easily see which is cheapest.’
Since Which? launched its ‘tackle tariffs’ campaign in September, over 6,500 people have emailed Ofgem asking them to make energy companies adopt a simple tariff system.
Ask Huhne to help us
We’re asking climate and energy secretary, Chris Huhne, to help us get a simple tariff system for all consumers and we need your help:
The Which? simple tariff would have a daily standing charge – as low as possible, and set by the regulator – that would be the same for all energy companies. On top of that, consumers would be charged a flat unit price for all of their energy units.
With a simple tariff system like this, customers would be able to compare tariffs at a glance to get the best deal. It would also stop low energy users – often the most vulnerable customers – from being penalised by paying significantly more per unit than high users.
Government must step in
During a Twitter Q&A with the Department of Energy and Climate Change, Greg Barker MP warned that energy bills were ‘far too confusing.’ He added that the Ofgem review was due around Christmas and he would ‘go further to simplify’ tariffs if its reforms weren’t radical enough.
Richard Lloyd said: ‘People expect the government to do more for consumers. Only last month, David Cameron called for a trusted, simple and transparent energy market and it is time for the government to set out how it will achieve this.’
- Clear, simple energy prices – find out about the Which? simple tariff
- Check that you’re on the cheapest energy tariff
- See how Which? is campaigning for more affordable energy