Reforming a funny business to keep prices as low as possible.
The energy department (1) has asked Professor Dieter Helm to carry out a review of the costs of energy and recommend ways of keeping prices as low as possible.
The review will seek “to sort out the facts from the myths about the costs of energy”. It’s not related directly to the recent British Gas price rise.
But Professor Helm has frequently raised concerns about the treatment of energy consumers and the failure of regulation.
Last year he was critical of the Competition and Markets Authority which failed to do anything concrete about over-charging by energy companies (2).
Like Citizens Advice Reigate & Banstead (3) he supported Martin Cave, the dissenting voice on the CMA committee. Professor Cave insisted the scale of overcharging (£1.4bn) demanded much more than the CMA was proposing.
After nearly 20 years, the so-called ‘competitive’ energy supply market is still not working for most customers.
Two out of three households have never switched supplier despite in effect being blamed by ministers, regulators and consumer groups as irrational or even lazy.
The outrage stirred up by the British Gas price rise showed again just what a funny business it really is.
The money saving expert himself, Martin Lewis, as ever doing his best for consumers, pointed to a potential saving of £276. “And switching is no big deal – there’s no break in service, no engineers coming to call – it’s the same gas, same electricity, same safety – only the price and who provides customer service actually change.”
Funny business or what?
Dieter Helm is widely respected and a plain speaker. It may not be in his brief but hopefully he and his team will persuade timid ministers and regulators that a great deal should actually change.
1) Independent review to ensure energy is affordable for households and businesses, BEIS, 06/08/17
2) Flawed in almost all its parts – the final CMA report on electricity markets, EFN Paper 19, Dieter Helm, July 2016
3) Energy overcharging. Reforms not enough, CARBS, 15/11/17
4) British Gas to hike electricity prices by 12.5%, MSE News, 01/08/17