Customers increasingly unimpressed with energy suppliers’ customer service

Satisfaction with the customer service provided by energy suppliers has continued to decline, according to the latest research by Ofgem.

The regulator has published its Energy Satisfaction Survey for the first time in almost a year following a “comprehensive refresh of the project” which it said was designed to better capture deeper insights into consumers’ experiences of the service from their energy suppliers.

This included a boosted sample size of more than 3,700 billpayers and a refreshed questionnaire.

“While the survey retains comparability with previous waves, the refresh means the survey is better placed to provide the evidence we need to inform action designed to drive standards,” Ofgem explained.

A majority of consumers (69%) said they were satisfied overall in August/September 2023, when the survey was taken. This is stable with 67% in November/December 2022, but well below the peak (78%) reached in April 2020.

While overall satisfaction was stable, satisfaction with customer service has continued to decline, dropping from 66% in the last wave to 62% this wave. Furthermore, satisfaction with customer service is now 13 percentage points below its peak of 75% in April 2020.

Those who are vulnerable are likely to be less satisfied with their supplier overall and its customer service, with 49% of those who are highly financially vulnerable saying they were satisfied with customer service compared to 71% of those doing well.

Commenting on the findings Jo Causon, chief executive of The Institute of Customer Service, said the link between low-income customers and low customer satisfaction is “absolutely a cross-sector issue”.

“The link between poor financial wellbeing and low satisfaction could be for several reasons – the most obvious being that there may be expectation from customers that businesses should provide extra support, and that customer service staff should be trained to deal with low-income and financially struggling customers, particularly in regulated sectors such as energy. Which is evidently not always the case,” Causon told Utility Week.

She urged businesses to address this by investing in staff training and upskilling, as well as developing robust and detailed strategies around how to identify and support vulnerable customers.

Meanwhile Ofgem found that dissatisfaction with customer service remains stable (11%) in comparison to November/December 2022 (12%).

Key reasons cited for dissatisfaction with customer service include customers not being able to contact at the time they needed (37%), not feeling they were being listened to (34%) and it taking a long time to resolve the query (34%).

Complaints

One in 10 contacts with a supplier were to make a complaint, which is in line with the previous wave.

The most common reasons for complaint were problems with bills (32%), followed by a problem with a smart meter (27%) and the pricing/cost of energy (26%).

Satisfaction was high for the outcome of the complaint (71%) but lower for the handling of the complaint (41%) and the length of the process (39%).

However, while still low, satisfaction with the overall handling of the complaint has improved by 12 percentage points compared to November/December 2022.

Smart meters

Of those surveyed, 62% reported having a smart meter, but one in five (19%) said they do not have a smart meter and that they would not consider getting one – this was equivalent to 52% of those currently without a smart meter.

The majority (81%) with a smart meter said they would be willing to share data with their supplier so that they could receive tailored information, or for identifying if they need support for paying bills (70%).

Yet issues are “commonplace”. More than a third (37%) of households with a smart meter had experienced an issue with it in the last 3 months.

Issues around automatic readings were the most common fault (12%), followed by in-home displays no longer working (11%). Issues with smart meters were far more common for those who had prepayment meters (46%) and those who paid by standard credit (60%) compared to 33% for direct debit.

A majority of customers with smart meters are satisfied, however. Two-thirds (67%) were satisfied with their smart meter, and just 12% were dissatisfied.

Those more likely to be dissatisfied with their device included those classified as being at high risk of being under cost of living pressures (18%) and those who had fallen behind on bills/run out of credit (17%).

Priority Services Register

More than a third (35%) of respondents reported that either they or someone in their household is on the Priority Services Register (PSR), but this is well below the percentage who are likely eligible (60%).

“That said, it is worth noting that the eligibility criteria for the Priority Services register is broad,” Ofgem added.

Satisfaction levels were generally high among those that say they registered on the PSR, with almost two-thirds (64%) expressing satisfaction with the services delivered.

However, there is some variation in satisfaction across different groups, with those aged 65 or over reporting lower satisfaction (57%) compared to the overall average satisfaction rate (64%).

Commenting further on the findings, Causon said: “While the current landscape – as evidenced by the UK Customer Satisfaction Index (UKCSI) and reaffirmed by Ofgem’s research – paints a grim picture, businesses can turn things around and start bringing satisfaction levels up by focusing on the right things and investing in the right areas. However, to avoid a further decline, they need to act now.

“The financial upside of getting the service proposition right is huge. Our recent research into the ROI of customer service shows that organisations getting it right are reaping the rewards.

“Companies with customer satisfaction at least one point higher than their sector average in the UKCSI achieved 10% higher EBITDA (profitability) than those with average satisfaction that is at least 1 point below the sector average.”

She added: “Customer service needs to be treated as a long-term strategic imperative rather than a cost to the business, and this attitude needs to be led by the boardroom and embedded in the culture of organisations.”

Meanwhile an Energy UK spokesperson said: “The energy crisis has seen suppliers dealing with an unprecedented amount of contact from customers and an accompanying increase in the complexity and difficulty of the cases they handle. Sadly millions of households continue to struggle with the cost of living and are falling behind on their bills – so some suppliers have seen customer calls increase still further this winter.

“While the Ofgem figures have remained relatively level recently, it’s unsurprising there’s been a fall in comparison to those before the crisis.

“Nevertheless suppliers understand the need to improve further and meet this level of demand and so have invested heavily in new staff, training and systems to help customers get the advice and support they need. Suppliers have also worked with Ofgem to implement new customer standards, including ease of contact – as well as stepping up to provide tens of millions of pounds in discretionary financial support.”