Consumers are not engaged in the energy market because of the practises of the Big Six.
That’s the view of Ed Kamm, Managing Director at First Utility, who believes the industry has not progressed towards engaging customers since the Competition and Markets Authority (CMA) published its reforms earlier this year.
Speaking to ELN at the Energy UK conference in London this month, he said: “I think the CMA correctly identified the problem in that the Big Six have what they call ‘unilateral market power’ over their standard variable tariff customers. Unfortunately we don’t believe the solutions they put in place address that situation.
“Roughly seven out of every 10 customers that are with the Big Six are not engaged in the energy market and we think it’s because of the practises of the Big Six. Because actually the last thing they want to do is engage with those customers because they might realise how much they are overpaying.”
Some of the CMA’s suggestions include a price cap for prepayment customers – which campaigners claim is not enough to help them – and allowing price comparison websites to only show tariffs that pay them commission regardless of whether or not they are the best deals.
According to Mr Kamm, customers who don’t switch their energy supplier want better information about how much they could save instead of more tariffs.
However, he believes the Big Six suppliers are not interested in addressing this issue by giving them more information about how consumers could cut their gas and electricity bills.
He added: “If you are a big energy company and there’s six of them out there, they have every economic incentive to leave those customers paying on average £300 more than they should, they have every incentive to leave those customers alone. They don’t want to prompt those customers, they don’t want to tell them there’s better deals out there because it’s not in their economic incentive.
“Expecting the big suppliers to do it on their own accord is not going to work because we’ve been saying that for years.”
Earlier this month the Big Six energy firms were accused of making profits seven times more than publicly claimed.