29 June 2011
The Government’s Coalition Programme states our intention to increase households’ control over their energy costs by ensuring that energy bills provide information on how to move to the cheapest tariff offered by their supplier, and how each household’s energy usage compares to similar households. Consumers need extra help to control their energy costs and the time has come for us to provide it.
As you know these measures are to increase consumers’ understanding of their energy bills, help them control their energy costs and encourage energy efficiency. Many consumers miss out on the best deals because they do not know how much money they might save changing their tariff or payment method - or they think it will be difficult to identify a better tariff. I am particularly concerned that vulnerable households do not know how much extra they might be paying. By telling consumers if they are not on the cheapest tariff, and explaining how these can be accessed, we can help consumers search for a better deal and cut their energy costs. By providing a comparison with a similar household, consumers will be able to judge whether they are able to make efficiencies and save on costs.
I am keen to work with you to achieve these goals, and to do so quickly by the end of the summer. While I know helpful discussions have been ongoing since the election, in order to ensure a swift resolution this summer I hope you will take personal charge of the issue.
Notwithstanding the powers being taken in the Energy Bill to introduce such measures, I think it would be vastly preferable, less burdensome and speedier if we could reach agreement on a voluntary approach that builds on the research commissioned by DECC and the consumer tests that you have done on different approaches.
As a retail company, you know your customers well and I would be interested in your ideas on how you could provide information on your bills to consumers on how to switch to your cheapest tariff and on how their consumption compares to similar households ahead of the meeting between ministers and the Energy Retail Association on 14 July.
I therefore look forward to hearing your proposals for providing the information to consumers within the next fortnight, to the opening of formal negotiations, to a swift agreement and for additional helpful information on consumer bills at the earliest opportunity.
Regards, The Rt Hon Chris Huhne MP