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Even energy retailers would admit it must be pretty bewildering being one of their customers. No sooner had the public grown used to the idea of a price cap – and what it would mean for an average dual-fuel standard variable tariff (SVT) customer – than a few weeks later they hear it’s set to jump again, by £117.
And when that lift from £1,137 to £1,254 kicks in on April 1, despite the regulator’s assurances that it has nothing to do with suppliers profiteering, it’s only natural that most people will feel short-changed when bills arrive. It will certainly seem a far cry from Theresa May’s election pledge to slash £100 off the average SVT bill.
Meanwhile, amid the now almost weekly PR fallout for energy companies, retailers can only look on – and vehemently disagree among themselves.
Some say the cap has saved money for millions of households, stopped legacy companies raising charges even further and decry those suppliers treating the cap as a target. Others argue it was always inevitable firms would congregate around the cap.
And the heated war of words shows no sign of cooling, with one “modern” retailer this week berating “dinosaur” companies for failing to deliver below the limit, while a big six spokesman fiercely condemned those offering unsustainable tariffs that have left others picking up the tab.
For increasingly baffled customers, perhaps the word itself was always destined to confuse. “Cap” to most will have suggested an ultimate ceiling, certainly something that would endure for longer than three months.
Yet it was never going to be a price freeze – how could it be, with the ongoing unpredictability of the wholesale price and another review due later this year?
No-one expected the price cap to end the debate about the cost of retail energy, far from it – though whether anyone expected one energy giant to mount a legal challenge about how it is set is another matter. Certainly, those sector voices I speak to who warned against market intervention but resigned themselves to capping are finding it increasingly hard not to say: “We told them so.”
For an industry that openly acknowledges it needs to be more consumer-centric, to share rewards and rebuild trust, the cap really hasn’t done energy companies any favours so far.
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