UTILITY WEEK | FEBRUARY 2022 |
5
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Customers need allies
We may have broken the back of winter but there is no shortage of discontent on
the horizon for billpayers across the country.
As much of our coverage this month makes startlingly clear, we are facing
a cost of living crisis and for many customers already struggling to make ends
meet, help is desperately needed.
Utility bills are, of course, just one part of a wider economic landscape that
has put household nances under immense pressure. However, there is no ques-
tion that the review of the energy price cap to be unveiled on 7 February will be
a painful moment, with expectations of a c50% increase from April.
As Utility Week goes to press, suppliers are locked in talks with the govern-
ment and Ofgem about ways to mitigate that pressure on consumers. Our Energy
Reset analysis on p12-13 sets out some of the options on the table, which range
from government loans to suppliers to help smooth out the impact on billpayers,
to wider tax and spend measures.
All of the options under considerati0n come at a price and this will inevita-
bly be a sticking point. However, the Covid-19 pandemic has set a new bar for
government spending and in the willingness for the state to directly intervene to
stave oŠ potential nancial hardship.
One of the other key talking points is around how targeted the approach
should be. This is one of the arguments against cutting VAT, as it would reduce
the bills even of those who could aŠ ord the rise. The Warm Home Discount is a
much more focused measure, but even so, it is thought to capture only a fraction
of the households most in need. As the Committee on Fuel Poverty chairman
David Blakemore points out on p8-10, the blunt instrument of using bene ts
receipts as an indicator of who cannot aŠ ord to heat their homes is likely to be
missing out almost half of the actual total.
Utilities companies themselves can do little to directly reduce those pres-
sures but as a new Utility Week report on vulnerability shows, companies are
seeking new ways of oŠ ering support and honing their messaging to customers
in need. As is pointed out on p30-31, there are many new forms of vulnerability
emerging, all with varying degrees of need. In some cases, this comes down to
a matter of • exibility. This requires the utilities sector as a whole to ensure it is
agile enough to allow customers this leniency.
If it can do this, there are opportunities to use this crisis to build trust and
establish long-term relationships with consumers.
As one senior energy retailer tells us on p14-15: "We have a golden opportu-
nity in front of us. But to make the most of it, we need to show customers we are
their allies."
James Wallin, editor, jameswallin@fav-house.com
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James Wallin,
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Nadine Buddoo,
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Innovate editor
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Senior reporter
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Ruth Williams,
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Policy correspondent
David Blackman,
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Drax
Expert View: More cost
transparency needed for
generators selling via PPAs
https://bit.ly/3r88JVe
DTN
Explore your expected winter risks
with an outlook from DTN
https://bit.ly/30W7kGk
SIMOCO
Re-imagine Your Mission Critical
Communications with Velocity
https://bit.ly/3l6IbQe
Letter from the Editor
James Wallin
