Too Many Hurdles: Information and Advice Barriers in the Energy Market

Author:

Mike George

Professor Cosmo Graham

Linda Lennard

Organisation:

Centre for Consumers and Essential Services

University of Leicester

Date: 2011
Location:

Rationale

The domestic energy market is heterogeneous and complex in terms of both suppliers and consumers. This means that ensuring the appropriate advice and guidance reach the relevant consumers is a challenge, but the dynamics are not understood in detail. This is essential if better policies and practice are to be developed, particularly for the proportion of consumers who are deemed to be vulnerable. It is also highly relevant for a number of reasons. An era of rising energy prices is likely to exacerbate vulnerability, the structure of information, advice and guidance services is scheduled to be overhauled, and regulatory agencies plan to review the operation of the energy market.

Key research Question

The study sought to identify what needs vulnerable consumers have when seeking information, advice and guidance and whether they are being met. If not, what barriers exist and why have they developed? Once this is understood, how might they be addressed?

Summary of activity

The research involved interviews with stakeholders working in the advice and guidance sector to gain a qualitative picture of the range of people’s needs and the difficulties faced.

Methodologies

Primary data

Expert and stakeholder interviews

Findings

Vulnerable consumers are being disadvantaged in two main ways: through their personal circumstances and the organisational systems operated by energy suppliers.
Individuals may have personal issues that prevent them from accessing information they require. These can include physical/mental health, learning difficulties, low literacy, language barriers or time restrictions due to caring responsibilities. These challenges may also create anxiety or fear about contacting suppliers.
Access to information and advice is often problematic. This can involve some or all of the following issues: lengthy hold times and multiple options on helplines; internet-only advice sources; complicated bill structures; the (un)availability of energy efficiency measures; and inconsistent and/or inflexible advice. Lack of trust in energy companies also acted as a disincentive to engage with suppliers or accept their advice.

Recommendations

Clearer, more accessible information is needed, particularly on issues such as tariff options, handling arrears and which payment methods are most appropriate. Government and regulatory agencies (the Departments of Business, Innovation and Skills, Energy and Health and Ofgem) and national organisations (Citizens Advice) should use their oversight to ensure these improvements are delivered and also guarantee that policies fully recognise the needs of vulnerable consumers and use their resources to promote independent sources of information through multiple avenues: for example, via health and social care professionals, third sector advice bodies, public fact sheets and/or adverts in different versions.
Energy suppliers should adopt and implement BSI standard BS 18477:2010 ‘Inclusive service provision’, which sets out how providers should ensure their services do not disadvantage any users and enable equality of access and outcome.
In general, suppliers should ensure their staff are trained to recognise customers with vulnerabilities and also remove barriers such as chargeable phone lines and complex bills and tariff structures.
In addition, they should establish protocols for dealing with third-party intermediaries representing vulnerable people and develop specific pathways for certain groups, e.g. alternatives to call centres for those with hearing loss, non-voice-activated options for customers with speech difficulties or home visits for older, less mobile consumers.

Other themes