Energy customers, especially vulnerable households, must be protected as the retail energy market undergoes rapid change, decarbonising and adopting new technologies.
Citizens Advice, the official consumer watchdog for energy, said the energy supply market needs “radical reform” to ensure consumers aren’t left behind.
The charity said 80,000 people already contact its local office for help with energy supply problems each year—numbers that are likely to rise as the ways in which consumers buy and access gas and electricity rapidly change. It warned that consumer protection must keep pacing with this change.
In a report published last week Citizens Advice examined emergent technologies that will transform the way consumers interact with the energy market. These may include consumers being able to trade power locally or adopt advanced, smart meter-enabled time of use tariffs, allowing them to save money by only using appliances at certain times.
But report also identified three significant barriers to may prevent consumers from accessing and benefiting from new energy technology. These include upfront costs: some future energy services will require the installation of new equipment, like battery storage, that may be beyond the financial reach of some households.
Additionally, the 5.3 million Britons without internet access and the millions more who aren’t confident using apps and websites may be left behind, as switching, billing, and even the process of accessing energy moves online.
Finally, many people are wary of granting smart meters and apps access to their energy data.
Gillian Guy, Chief Executive of Citizens Advice, said: “The government’s recent adoption of a net zero carbon emissions target means big changes in how we access energy are on the way.
“New innovations in the way we heat and light our homes will bring benefits for many. The danger is that some of the most vulnerable in society end up excluded from these exciting developments.
“How much you earn, or whether you’re confident with a smartphone, shouldn’t prevent anyone from getting the best out of this rapidly evolving market.”
To protect consumers, the energy retail market of the future should reflect the principles of engagement, transparency, fairness, and control, Citizens Advice said. It has suggested a number of ways the market could deliver this, including offering grants and low-interest loans to allow consumers to install new technologies.
Suppliers should also maintain non-digital ways for consumers to sign up and communicate with them. By default, customers should be given control of their energy usage data. And all consumers should have continued access to advice and redress.
Citizens Advice said the forthcoming consolation documentation from energy regulator Ofgem is an ideal opportunity to lay the groundwork for these reforms.
