Editor’s letter: Still no love for energy companies

While the water market struggles to get any visibility at all with customers ahead of non-domestic market opening (see p4), energy suppliers continue to suffer an embarrassment of publicity – in more ways than one.

Already this year we have seen a splurge of stories in the national and industry press which show that despite a long-term decline in the cost of dual fuel energy supply since 2014 and widespread efforts to rebuild the reputation of the sector, energy companies are little closer to obtaining public trust than they were when the Competition and Markets Authority’s investigation into the sector was triggered.

Most recently, national papers have reported on a warning issued by Ofgem that suppliers have no excuse to raise energy prices in the current market environment – despite volatility in the wholesale cost of energy. The coverage came after the release of Ofgem’s first Supplier Cost Index, a metric designed to boost transparency around price setting over time (see analysis).

Adding to this scrutiny of fair play in energy supply, Roger Witcomb, chair of the CMA’s energy market investigation, used Utility Week’s Energy Customer Conference as a platform to criticise the “incredibly opaque” financial reporting delivered by suppliers. His criticism of a retail market that, as a result of its continued failings, may soon find itself “a thing of the past” was echoed by Ofgem’s Rachel Fletcher who said the market was in “a last chance saloon”.

Some suppliers have found things to celebrate. Ovo Energy has received recognition for topping the Which? customer satisfaction chart for the second year in a row, and People for Places Energy – a new entrant – was pleased to be ranked second. In business retail, Citizens Advice crowned Eon the most effective of the largest 15 energy suppliers in the market.

However, for every chart topper there is a laggard, and it will take more than a handful of celebrations at the sector’s top performers, or even boasts of improved switching rates last year, to alter the persistent belief held by a large proportion of the public – and their representatives in government – that the energy market is not working.

The shadow of this knowledge hangs over the industry as it begins a challenging year, with concerns about the treatment of vulnerable customers and the effective delivery of smart meters already brewing.