Ofgem demands action from energy firms as complaints soar

Ofgem has demanded action from energy companies to address poor consumer complaint handling.

Energy firms were today told to improve their handling of customer complaints after research showed that over half of customers with complaints were dissatisfied with the way in which they were dealt.

The regulator said it will bring forward its next scheduled survey of customer complaints to next year, and if no improvement is shown will take regulatory action against companies found at fault.

This year’s survey found that consumers were particularly unhappy with the time companies take to resolve complaints, poor communication during the complaint process, not being more proactive in resolving complaints and the fact that suppliers often viewed the problem as resolved when in the customer’s eyes it was not.

Ofgem added that satisfaction with npower and Scottish Power has fallen particularly markedly with only SSE managing to maintain levels of satisfaction found two years ago.

In a letter to the six biggest gas and electricity suppliers and smaller independent suppliers, the chief executive of the energy regulator, Dermot Nolan, said he required the companies to account to customers.

He said: “These satisfaction scores are frankly awful. Almost all energy suppliers need to improve their complaints handling as a matter of urgency. There are real business benefits to good complaints handling schemes, and it shouldn’t need a regulator to tell companies about the importance of this.

“Suppliers must now tell their customers what steps they will be taking to put things right. We are already formally investigating npower about complaints handling and other customer service issues, and this should send a strong signal to all suppliers that, where necessary, we will take action,” he added.

In response to Ofgem’s supplier complaints handling research, executive director of Which? Richard Lloyd said: “It shouldn’t need involvement from Ofgem for energy companies to get the basics right. We found energy companies have hit rock bottom with woeful service and dreadful complaints handling.”

He added, “This situation has been going on for far too long and it’s little wonder that consumer trust is so low. Suppliers need to respond with immediate improvements, not wait for the results of the CMA’s market investigation.”