With around one month to go until the Competition and Markets Authority (CMA) announces the provisional findings of its energy market investigation, Which? has sent the CMA an open letter setting out a series of public tests against which they should be judged.
We have been highlighting the failures of this market for many years and welcomed Ofgem’s decision to refer it to the CMA as a chance to dramatically improve consumer engagement and restore trust. More than 200,000 people have now backed our Fair Energy Prices campaign calling for simpler and fairer energy pricing.
The letter sets out the five tests that Which? will use to rate the CMA’s remedies:
1. Increase consumer engagement and introduce reforms such as simple pricing to make the market less complex for consumers.
2. Protect consumers who are unable or choose not to engage and as a result languish on poor value standard variable tariffs.
3. Ensure smaller suppliers can genuinely compete with the Big Six suppliers, looking particularly at vertical integration and the effect it has on new entrants.
4. Deliver greater transparency over Big Six profitability especially whether there is sufficient competitive pressure to ensure wholesale price cuts are passed on fairly.
5. Improve liquidity in the market and ensuring better information is provided on wholesale trading.
Which? executive director, Richard Lloyd, said:
“The CMA investigation is a golden opportunity to ensure the energy market is performing competitively, efficiently and in the interests of all consumers. The CMA must announce remedies which will tackle the fundamental failings of this broken market once and for all.
“After years of being poorly served by energy suppliers, consumers are expecting to see radical proposals that will dramatically improve this market and restore trust.”