Water retail reports contain ‘too many bells and whistles’

There have been too many bells and whistles in the reports published about the water retail market, promoting it as a success, according to Water2business managing director Charley Maher.

In an interview with Utility Week’s sister title Water.Retail, Maher said she had been “disappointed” with the first year of the open water market.

Although there are “certainly some things that have worked well”, Maher said the market is still plagued by issues which are preventing it from being classed as a success.

“The number of retailers that went live is a real success, and the fact that you’re still seeing new retailers come through and gain their licence shows that that process works, which is good for customers,” she said. “However, it’s only good for customers if they know about it.”

She said one of the “big issues” from a customer point of view is that it is difficult for them to compare prices.

“We’ve seen examples where customers have been given quotes from several different retailers, but every water retailer is putting their quote across in a different way,” she said.

She added that this can be misleading for a customer, who thinks they are getting the best deal when they are not.

“If this market is really going to work for customers and if customers are really going to trust the market, there has to be more standardisation in how we [retailers] deal with customers.”

Another issue she highlighted was that of credit terms. “Wholesalers have never had it so good, in the sense of they’ve never received their money so quickly,” she said. “That causes a real problem for a retailer that is trying to give the best deal for customers without absolutely breaking their cash flow.”

She added: “As a retailer we’re expected to be as supportive as possible for customers to enable them to get a great deal, but we’re not necessarily afforded the same by the wholesaler. Given our margins are so small, we aren’t able to play around with cash flow like the wholesalers may do.”

Asked if she thought competition should be introduced into the domestic market, Maher said she doesn’t feel the business market has been “enough of a success at the moment” to justify it.

“I still don’t think that, as an industry, we’re being honest enough – publicly – around what work we have to do or what lessons have been learned,” she said. “I think there is still more work to do and it still isn’t a stable market.

“Until all of those business customers out there understand that a market exists, we can’t class it as a success. So, I think we need to continue with the good work that we’ve started, but I think it’s far too early to say.”

Collaboration with the wider industry will be a key focus of the market operator (MOSL) for the second year of the competitive water market, it said in its inaugural annual CEO market review published on 31 May.

It reflected on the first 12 months of the business water retail market but also explored how it can address issues and drive improvements.

Chris Scoggins, chief executive of MOSL, said:“We have deepened our understanding of market issues and seen some encouraging results from early efforts to drive forward improvement in key areas.

“However, there is still much to do to make the market the best it can be.”

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