Retailers urged to make energy bills clearer

Energy retailers have been urged to simplify the language used in consumer communications after a survey found the majority of customers (76%) are confused by their bill.

Consumer group Which?’s research found almost half (48%) of all consumers said they experience a negative emotional response when reading their bills.

Meanwhile 47% said they find it stressful and a similar number (49%) said it makes them feel anxious – this stress is even more common when energy bills are unclear.

During an experiment conducted by Which? more than 2,000 consumers were given either a ‘control’ mock communication from an energy supplier about a direct debit increase – based on emails and letters currently being issued by retailers, or a ‘test’ correspondence – engineered by Which? to be more comprehensible – to see which performed best.

The test communication contained features such as simple language which clearly explained why the direct debit amount needs to change and included a personalised graph of the consumer’s energy usage.

Almost half (45%) of consumers who received the improved communications answered a set of comprehension questions correctly – compared to just over a quarter (27%) of those who saw the mock control communication.

Two-thirds (65%) of those who received the test correspondence completely understood why the direct debit change was needed. This compares to half (48%) of those who saw existing communications.

Consumers who did not receive any explanation were much more likely to challenge the change – four in 10 (38%) said they would challenge it compared to three in 10 (28%) of those who received the test explanation.

Meanwhile three-quarters of consumers (74%) who found their bills unclear reported that they did not trust their energy provider, compared to just three in 10 (30%) of those who found their bills clear.

As a result of its findings, Which? is calling for retailers to amend their billing and direct debit communications to include simple language, a clear explanation of how direct debits work and why any change is needed. It is also calling for bills to include a personalised energy usage graph and for them to consider readability, such as by highlighting key information in bold.

Rocio Concha, Which? director of policy and advocacy, said: “Our research has found that how energy firms communicate with their customers really matters – and can completely change how people feel about both their bill and their provider.

“Changes such as using simple language and clearly explaining why direct debits are changing – could help to reduce consumer’s stress and anxiety when reading their bills, improve trust in energy companies and reduce customer queries.

“Which? is calling on energy providers to take this opportunity to make their bills as clear and simple as possible.”

Responding to the findings Dhara Vyas, Energy UK’s deputy chief executive, said: “We welcome the sharing of best practices when it comes to standards around bills. There are several elements in an energy bill that suppliers are obliged to include, and these include terms that might be confusing to customers, but it’s in everyone’s best interest to ensure that people understand their bills.

“If customers have any concerns about their energy bills, their supplier is best placed clarify any questions and offer extra support when needed.

“The cost-of-living crisis has affected millions of people, and more and more people are calling their energy supplier for support. Energy companies have worked hard to deliver customer support over this time, setting up dedicated affordability and vulnerability teams, implementing new training and processes to ensure customers get support tailored to their needs, but also hiring and retaining more staff to respond to customer demand.”