August 10, 2017
CMA Price Transparency Update
Since Energylinx for Business wrote their last article on CMA price transparency, the legislation and the requirement for energy suppliers to show energy prices on their websites for micro-business customers has gone live. The deadline of June 26th has come and gone, so the big question is how many suppliers have complied with The Energy Market Investigation (micro-businesses) Order 2016?
The good news is that most suppliers have made an effort to display their prices on their websites.
The bad news is that around 70% of suppliers that Energylinx for Business has reviewed, aren't yet displaying the 'Required Pricing Information' in the prescribed format. So, there's still quite a bit of work to be done!
The big thing that most suppliers are failing to do is to properly report the "the total estimated cost for the duration of each contract, calculated from the Primary Information and (b) as applicable, the cost of each of the following components (i) Standing Charges, (ii) Unit Rate(s), and (iii) all other associated charges".
Maybe it's just a mistake and energy suppliers will, eventually, comply with the Order. But, to achieve true price transparency, Energylinx for Business believe there are still a few things that the industry need to address:
- Average Pricing (p/kWh)
If a consumer enters a cost estimate for their energy 'Primary Information' then unless all suppliers are using the same average pricing to derive consumption, the consumption derived will be different on different supplier sites. This could lead to the customer thinking that "Supplier A" is offering a cheaper product than "Supplier B" simply because the derived annual consumption is different.
- TPI Product Options
A lot of suppliers work with Third Party Intermediaries (TPI) and as such may display prices on their websites that relate to these parties. If the TPI themselves do not display prices on their own websites (use a call centre approach) then how does the customer know whether or not they can get the product that the supplier has said is available from that TPI? Surely TPIs should be displaying product prices (the same product prices) in the same manner as energy suppliers in order to achieve true price transparency?
Price transparency is, undoubtedly, a good thing for the industry and will help more micro-business owners shop around to get the best deal possible. We hope that at the end of this year, we will be able to update this article again and hopefully report back that all energy suppliers are fully compliant and that more and smaller business owners are switching to gain better deals.
If you want an online solution of your own business (Broker or Supplier) then Energylinx for Business would be delighted to hear from you.
Posted on August 10, 2017 at 03:28 PM