Citizens Advice welcomes competition investigation into the energy market

Citizens Advice has welcomed Ofgem’s news that the UK energy market is to face a full investigation by the Competition and Markets Authority (CMA). The charity has called for the investigation to look in-depth at structural problems which are inflating prices and giving consumers a raw deal.

Citizens Advice Chief Executive Gillian Guy said:

“People’s trust in energy firms is at rock bottom. Consumers are struggling to meet costs that have risen seven times faster than earnings, and our evidence shows people are increasingly dissatisfied with the service they are getting. Switching rates are at an all-time low and Citizens Advice has seen a 21 per cent increase in people reporting problems with energy.

“This investigation is long overdue and needs to lift the floorboards on the energy market and take a long, hard look at why it fails consumers. It is an opportunity to address the structural problems in the energy market once and for all, and get to the bottom of whether people are paying a fair price to heat their home and put the lights on.  It must drive the market to work for all consumers and encourage fierce competition between companies in order to keep a lid on prices.

“Suppliers don’t have to wait until the investigation has finished to sort out some of the underlying problems, and energy firms who act quickly will be the first to win consumers’ trust back.”

Citizens Advice wants the competition investigation to:

•Make sure the market works for all consumers, including those on pre-payment meters, not just the small segment who switch suppliers

•Make sure that social and environmental schemes are delivered cheaply, transparently and effectively

•Increasing competition to keep prices as low as possible

•Boosting transparency and increasing consumers’ trust in the market

In its response to the consultation, Citizens Advice highlighted how 4 in 5 consumers want the energy market investigated for competition and 73% want tougher regulation of the sector.

New figures from Citizens Advice reveal a 21% increase in the number of fuel problems reported to the national charity in 2013/14, compared to the previous 12 months.

Between April 2013 and March 2014, Citizens Advice helped with 49,192 fuel problems, up from 40,560 from the year before.  Five most commons problems reported to Citizens Advice around fuel are:

Fuel debt is recorded separately. The top issues are based on those with comparable data for the previous year. Citizens Advice also helped with 4,115 queries about Warm Homes Discount.

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Notes to editors:

1. The Citizens Advice service comprises a network of local bureaux, all of which are independent charities, the Citizens Advice consumer service and national charity Citizens Advice. Together we help people resolve their money, legal and other problems by providing information and advice and by influencing policymakers. For more see the Citizens Advice website.
2. The advice provided by the Citizens Advice service is free, independent, confidential, and impartial, and available to everyone regardless of race, gender, disability, sexual orientation, religion, age or nationality.
3. To find your local bureau in England and Wales, visit citizensadvice.org.uk. You can also get advice online at adviceguide.org.uk
4. You can get consumer advice from the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 for Welsh language speakers
5. Citizens Advice Bureaux in England and Wales advised 2.3 million clients on 5.4 million problems from October 2013 to September 2014. For full 2013/2014  service statistics see our quarterly publication Advice trends
6. Citizens Advice service staff are supported by more than 21,000 trained volunteers, working at over 3,000 service outlets across England and Wales.