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Former shadow energy minister Tom Greatrex has warned the big six that the energy sector cannot return to business as usual ahead in the final stages of the Competition and Market Authority (CMA) probe.
The former Labour MP told Utility Week that the “attitude” of the big six energy companies following the initial findings report on Tuesday needs to change ahead of December’s final recommendations report if the industry is to seize the opportunity to work with regulators to heal consumer mistrust.
“Being less defensive and more transparent in response gives an opportunity to provide the fresh start and clear explanations called for 12 months ago, where innovation and good customer service provide the competitive impetus in a market which is clear, fair and transparent,” Greatrex has said in an exclusive column for Utility Week.
The CMA report focused on mounting concerns over so-called ‘sticky’ customers who do not engage with the market and pay energy bills well above those who do opt for a cheaper deal. The CMA has therefore suggested a temporary cap for the ‘default’ standard variable tariff while the market is reformed.
The partially regulated tariff echoes Labour’s election pledge to freeze all energy tariffs so they cannot move higher for a period of 18 months. But Greatrex said that consultation between the industry and regulators on how the CMA proposals could be implemented is an important opportunity that the industry must seize.
“Hoping to return to business as usual won’t work,” Greatrex warned.
“While the fall in wholesale prices has resulted in less public attention, an unreformed market will see the same issues return with a vengeance when gas goes up again – but with greater disdain and less patience on the part of the consumer,” he added.
The CMA is expected to publish another interim report in October before it’s final findings and recommendations are made in December.
Tom Greatrex’s column will appear in full online and in print on Friday 10 July.
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