Government debate on energy prices: how should energy companies react?

Today, the House of Commons will debate the issue of ‘fair’ energy prices following calls for ‘immediate’ action from a cross-party group of MPs.

The discussion, brought to the fore by MPs Caroline Flint, John Penrose and Patricia Gibson, will centre around the ‘Big Six’ energy firms and their treatment of customers on default tariffs. It comes after the recent announcement of price hikes by three of the largest energy firms since the start of the year.

The group, which persuaded the Department for Business, energy and industry strategy to allocate time for the debate says that privatisation has not helped customers by simply offering the chance to ‘switch’. It ‘calls on the industry, regulators and the Government to consider solutions which recognise that many people lead busy lives and that switching their energy supplier may not always be a high priority.’

Capping variable tariffs has been presented by some as a solution to the problem as customers are often being put onto these deals once their lower tariffs have expired. But are there other steps that energy companies can take to regain trust from consumers?

Given the lack of ‘switching’ activity from consumers, arguably the main precipitator of the debate today, energy companies clearly need to be more proactive in their customer engagement activities.

It is pertinent to remember that customers are comparing their engagement levels not just with other energy suppliers but with other service providers from different sectors. They expect a fast response, a diversity of interfaces they can interact with and round-the-clock availability.

To provide these as well as the levels of trust customers require, energy companies will need to employ innovation and streamlining to their internal systems and processes. Provided consistently, accurate billing is a building block of trust, being accurate over time shows customers you are reliable; billing automation also improves this accuracy and reliability of billing processes.

By streamlining billing, CRM and collections activity further internal efficiency will be generated and this will directly influence external customer communications activity.

The upshot of the debate today is still unknown but regardless of the outcome, energy companies will always need to drive internal efficiency to create better output to the customer and at a time of uncertainty, this has never been more important.

ENDS

Sources

https://www.theguardian.com/money/2017/mar/12/millions-overpaying-energy-bills-admits-ministry-big-six

http://utilityweek.co.uk/news/mps-turn-up-the-heat-on-energy-prices/1297802#.WMgBoU1vjIU