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The Topic: TPIs THE TOPIC 10 | 3RD - 9TH JULY 2015 | UTILITY WEEK THIRD PARTY INTERMEDIARIES Micro and small busi- nesses might be assumed to be easy prey for unscrupulous TPIs, but despite advocacy groups such as the Federation of Small Businesses and Citizens Advice complaining of a "protection gap" that exposes small business energy customers, a recent survey conducted for Ofgem by BMG Research of more than 1,500 such businesses showed high satisfaction rates overall. However, the detail of responses shows there is much to be desired when it comes to transparency of purpose, fees and the way in which customer contacts are managed by TPIs in the small business space. MICRO AND SMALL BUSINESS EXPERIENCE OF TPIs I n March the delivery of a long-promised mandatory code of conduct for non- domestic TPIs was delayed until after the results of the ongoing Competition and Mar- kets Authority investigation of the energy market. Already two years in production, the code should bring transparency to an opaque market, where just a small section of players is will- ing to declare what they earn in commission. The code, if enforced, will require TPIs to declare their com- mission earnings and require energy suppliers to deal only with licensed TPIs. Today, it is by no means standard for suppli- ers to place any specific require- ments on TPIs serving their mutual customers to behave in a certain way. Some suppliers, such as EDF Energy, have their own TPI partner auditing struc- tures, but others have none. As TPIs handle the majority of contracts in the non-domestic market – up to 85 per cent of large industrial contracts – the introduction of a universal and mandatory code of conduct would bring about big changes in the way business is conducted in the industrial and commercial energy market. There is already a volun- tary code of practice for TPIs, but Ofgem admitted in a letter announcing the delay of the mandatory code that it knows that only a few follow these rules. Jo Butlin, chief executive of commercial energy solutions provider Utylix, says that "half of the TPI world is massively frus- trated that it has been shelved, and half are hugely relieved". It is the relieved ones, she says, who are damaging trust within the TPI market by oper- ating in a world of "smoke and mirrors." Butlin believes Ofgem's delay is a detriment to non-domestic customers and that "a lot of [TPI] businesses are making a lot of money by not being transpar- ent". Ofgem justifies its decision Market waits for mandatory code Energy companies are still waiting for Ofgem to pronounce on a mandatory code of conduct for non-domestic TPIs. Perceived conduct of brokers in approaches to business (where approached by a broker) Main source consulted when choosing current gas or electricity contract of tariff, by organisation size – prompted, multiple response (all respondents) Number of times business have been approached by a broker in the past 12 months (all respondents) Extent to which businesses are satisfied with the service provided by the price comparison website to telephone service Very satisfied Quite satisfied Neither Quite dissatisfied Very dissatisfied Don't know A broker A price comparison website or telephone service Current supplier only Other suppliers None 1-10 times 11-20 times 21-30 times 31-40 times 41-50 times >50 times (too many to count) Don't know Identified themselves clearly as an energy broker They provided accurate information about the services they offered Their tone was professional They were upfront about whether there was a cost for your business for their services 31% 24% 23% 20% 22% 20% 31% 44% 33% 11% 14% 10% 12% 37% 25% 22% 26% 42% 11% 6% 3% 6% 6% 14% 5% 1% 4% 13% 41% 15% Don't know No Yes All businesses (1,502) 0 employees (231) 1-9 employees (820) 10-49 employees (451) 22% 55% 23% 14% 25% 61% 13% 37% 50% 26% 34% 40%