Complaints over switching energy provider on the rise

File photo dated 12/08/17 of a gas ring on a home cooker.

Unresolved complaints about switching now outnumber those relating to poor customer service, Energy Ombudsman figures show.

Issues arising from switching energy supplier are now second only to billing, with the ombudsman handling 1,016 switching complaints in the last quarter of 2018 – a 14% year-on-year increase.

Over the course of last year, the ombudsman completed investigations into more than 3,000 switching complaints, with half of these relating to billing, refunds or credit balances.

A growing proportion of switching complaints are about small suppliers, rising from 15% in the last quarter of 2017 to 28% for the same period last year.

Other common complaints related to customers being switched without their consent, switches not going ahead, delays in the process, objections by the losing supplier on the grounds of debt, incorrect meter readings at the point of switching and a lack of information.

Energy UK’s latest monthly figures, also published on Thursday, show that more than 600,000 customers switched electricity supplier in March 2019.

This brings the total number of switches to 1,451,145 this year, up 12% when compared to the same point in 2018.

The figures come as the energy sector prepares for the introduction of new rules that will require suppliers to automatically compensate customers if their switch goes wrong.

Under the automatic switching compensation scheme, which takes effect on May 1, consumers will receive at least £30 in compensation for each switching problem they experience.

Ofgem says the new rules will give consumers peace of mind, boost confidence in switching and act as a “wake-up call” for suppliers.

Matthew Vickers, chief executive at the Energy Ombudsman, said: “Switching energy supplier can help consumers get better value for money and better customer service, so it’s important that they can have confidence in the switching process.

“Our data shows, however, that too often changing supplier can cause issues that take weeks to resolve and require escalation to us as the ombudsman.

“Problems that we see include everything from customers being switched in error, to delays in refunding credit balances to departing customers.

“The message to suppliers is that regular switching is the new normal. A customer who has just left you could potentially be a customer again in future.”

Natalie Hitchins, Which? head of home products and services, said: “Switching is by far the best way for consumers to avoid rip-off energy tariffs, so it is really worrying to see such an increase in switching complaints including problems with bills and delayed refunds – which can leave customers out of pocket.

“The regulator now needs to deliver on its automatic compensation proposals so that companies have an incentive to get it right first time and consumers are not put off switching – given they could potentially save more than £300 a year.”

Lawrence Slade, Energy UK’s chief executive, said: “It’s very positive to see increasing numbers of customers continuing to switch and engaging in the market to make sure they’re on the best deal for them – and of course, this number doesn’t include those customers who choose to move to a new tariff with their current supplier, which would add many more thousands of households.

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“It’s most likely that this month’s increase is in response to the recent price cap rise announced by Ofgem, showing how the price of electricity and gas is affected by variable costs – the vast majority of which are out of suppliers’ direct control.

“While we hope engagement levels remain high, we can only really assess the cap’s effect on switching over a longer period of time when it might fall as well as increase.

“The one way to ensure lasting savings for all customers – whatever happens to unavoidable costs and the resulting effect on bills – is to make all our homes and businesses energy efficient and for customers to take advantage of new smart tariffs which will help save more money immediately.

“As our forthcoming Future of Energy report makes clear, we need to make energy efficiency a central part of our future.

“Efficiency measures cut bills by hundreds of pounds a year and in a week where concerns on this issue have been prominent, using less energy has been shown to make a huge contribution to cutting our emissions.”