Utility Week

10 | 22ND - 28TH MARCH 2019 | UTILITY WEEK Policy & Regulation An overall ranking of service would help consumers judge which suppliers are worth shortlisting. Price savings or quality of service – or both? Voices Stephen Littlechild A lmost every day we are told of the tariff sav- ings available if we switch energy supplier. The Competition and Markets Authority (CMA) recom- mended that Ofgem urge customers to engage more, and to switch to better priced deals. Ofgem has hailed the success of its collective switch trial, a•er which 22.4 per cent of customers switched to lower priced suppliers and saved an average of around £300 per year. But wait! Last year many of the lowest price suppliers later put customers on to higher priced default tariffs. Some suddenly or repeatedly increased their tariffs. A dozen or so suppliers went bust. Some suppliers have been almost uncontactable. Ofgem has banned a few suppliers from taking more customers until their cus- tomer service record improves. So, how can customers moving to a lower priced sup- plier today be sure they are moving to a better supplier over the longer term? To its credit, Ofgem "required Energyhelpline to consider customer service when selecting the winning collective switch tariff to offer customers". How best to do this? Increasingly, price comparison websites and other third party intermediaries are developing their own indices of customer service. But how comprehensive are they, and how to choose between them? An Overall Customer Service score I have elsewhere suggested an Overall Customer Service score. This combines the rankings from three separate, independent, recent and important sources. Citizens Advice compares suppliers every three months across five different categories of customer ser- vice based on objective data about complaints, billing, switching, etc. The latest ratings are for July-Sept 2018. Which? compares suppliers annually on similar but more categories, including value for money, and rates based on systematic interviews with customers. The lat- est survey was in September 2018. Trustpilot reflects the subjective views of customers themselves. Its Trust score is updated daily as and when customers feel inclined – or are invited – to report their experience of prices, customer service, contactability, or whatever else interests or concerns them. My proposed Overall Customer Service score is the simple average of these three sets of ratings (normalised to a value out of five). As of today, a total of 26 suppliers have ratings from all three sources and can thereby be scored. The table of supplier rankings, right, shows the result. The suppliers fall naturally into four divisions: excel- lent, good, mediocre, and poor. Broadly speaking, the medium-sized suppliers are in the top two divisions, and the six large suppliers are in the bottom two divisions, while a dozen or so small suppliers are scattered across the divisions. This is not to say that suppliers in the lower divisions always provide poor service to all customers. There must be many existing customers who don't have strong concerns about tariff increases or changes in direct debit levels, and who have not recently switched, for whom existing customer contact – or lack of it – is just fine. But these suppliers do not seem to have won over other cus- tomers for whom such aspects of service are important. There are another 40 or so small suppliers not included in the table. They may be good, bad or indif- ferent – we just don't know enough about them yet to include them in the rankings. But most already have Trustpilot scores, and hopefully can be included when Citizens Advice and Which? repeat and extend their surveys. As noted, some comparison websites have supplier rating systems too. That of Uswitch is shown in the last column. The scores for 2018 and 2019 are based on YouGov surveys in November 2017 and November 2018, respectively. The main change is a slight downrating of the large suppliers. My Overall Customer Service score reflects a wider range of inputs and has a finer classifica- tion. But the two rating systems give broadly consistent results. Evaluating the offers available today Now consider the offers of savings available today. On 4 March Uswitch noted that all the large suppliers and nine smaller suppliers had announced price increases of around 10 per cent. It was nonetheless able to publish a "best buy" table of ten offers of savings of between £258 and £324 on the tariff cap level of £1,254 a year. How should customers choose between these suppli- ers? Or do they have to look beyond them, and accept lower savings in order to ensure good customer service? Consider how these ten suppliers fare in the Overall Customer Score league. Six of them don't appear: they are simply not yet well enough known to have estab- lished a reputation. Another one does appear but in division three, the "mediocre" category. That leaves two suppliers with "good" reputations (Avro Energy saving £284 and Green Network Energy saving £258) and So Energy in the "excellent" category How can customers moving to a lower priced supplier today be sure they are moving to a better supplier over the longer term?  Stephen Littlechild is Emeritus Professor at the University of Birmingham; a Fellow at Cambridge Judge Business School; and an Associate in the Energy Policy Research Group there. He was the first Director General of Electricity Supply 1989-1998.

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