The Commission for Energy Regulation has announced a range of sweeping changes to consumer protection rules, which will greatly benefit gas and electricity customers across the country from 2017.
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Today is a very good day for energy customers.
The Commission for Energy Regulation, which is responsible protecting energy customers, is making more than 60 changes to the suppliers’ rulebook. Most of these changes have energy customers in mind, and are designed to make sure that they are not mis-sold, misled, or mistreated by suppliers.
The new Supplier Handbook rules, which will take effect in the New Year, will benefit energy customers by making offers easier to understand, giving customers information that will help them get better deals, and introducing a range of new protections for vulnerable customers.
Even doorstep sales agents will have to follow strict new rules which are designed to make sure householders are not misled, and fully understand energy deals before signing up.
We’ve read through all of the new rules and put together the top twelve that we think will make a big difference for you, the energy customer.
1 - 30 days written notice that your discount is about to expire
The CER will require suppliers to send customers a written notice 30 days prior to the expiry of a fixed term contract. Basically this means that if you switched last year and your discount expires next month, your supplier has to tell you about it. This is great news for customers because it will help them avoid being rolled over on to expensive standard rates.
2 - Estimated Annual Bill
Starting in the New Year, energy suppliers advertising new deals will have to say how much it’s likely to cost an average household for a year. This is terrifically useful information and should shine a light on confusing discounts, incomplete information and ambiguous marketing messages. It will also ensure that consumers are properly informed before signing up to new deals.
So now if a supplier says something is the cheapest, they will have to prove it in writing. TV and radio ads will be exempt from this rule though.
3 - Notice that you’ve been on the same deal for 3 years
If you’ve been on the same energy tariff for the last three years, you supplier is going to have to tell you in writing essentially to let you know that there may be better deals out there. Your supplier is also going to have to make cheaper deals, that would normally be reserved for new customers, available to you as well.
4 - Making the switching process easier
The CER says that from 2017, suppliers’ systems, policies and processes should “facilitate and support the switching process’’. That this needs to be written in stone by the regulator is interesting, but the fact is that right now it can difficult to switch away from certain suppliers even when you're out of contract. This new rule will mean that suppliers will no longer be able to put barriers in your way if you want to switch. And if they try to, you’ll know what to do!
5 - Clear and easy to understand marketing and sign up material
Basically, suppliers will have to be up front and ensure that the information they provide to customers is “complete, accurate, transparent and not misleading in terms of information that is provided and omitted”. We sure hope that suppliers haven’t been telling porkies to sign up customers, but now if they do now they’ll have the regulator to answer to!
6 - Making it easier to finding out what you’re paying
We run a stopwatch challenge from time-to-time here at bonkers.ie, and it goes something like this…
See if you can find prices for XYZ supplier on their own website. Ready? Steady? Go! With some suppliers it’s easy and you can find the prices right away. With others suppliers it can take absolutely ages – and that’s with people who actually work in the business looking for them! So if we have a hard time finding prices for some suppliers, then regular punters must have a very hard time finding prices as well.
Obviously the CER knows this too, so they've brought in a new rule that says that prices should be “easily identifiable and accessible from a prominent position on the home page of their website”, and that it should take no more than two clicks to get them. Which will put an end to our fun and games...
7 - It needs to be as easy for a Pay As You Go customer to switch as it is for a credit customer
If you are a prepayment customer it can be difficult to switch. You may need to give up to 30 days’ notice (even if you are out of contract), you may need to pay to have your prepayment meter removed, and you’ll need to get your supplier to give you something called a deactivation code so you can switch. And trying to get the deactivation code will likely result in remarketing by the supplier. Customers with regular meters do not have to do any of this. So the regulator is making new rules to make it easier for prepay customers to switch. Prepay suppliers must also release that deactivation code to the customer within 10 days of applying to switch.
8 - Giving customers all the information they need up-front when they sign up
When you sign up to an energy deal, you need to be told about any and all of the charges you’ll pay while you’re a customer, and the charges you’ll pay when you want to leave. These include the usual things like unit rates, standing charges and cancellation fees, but will also include stuff for prepay customers, like prepayment service charges and meter removal fees. And the supplier must tell you about all these charges by post or email so there’s no surprises later on.
9 - Doorstep and distance selling – new rights for customers
If you agree to change supplier on the doorstep, the salesperson will now have to leave a cancellation form with you so you can change your mind after s/he has left. The salesperson will also have to clearly explain everything to do with the energy deal, and make sure it is suitable for you. Then the salesperson will then have to go through a “Doorstep Checklist” to make sure you fully understand what you’re signing up to. It'll be more work for the salesperson, but much better protection for the customer.
10 - Fair deposits and cancellation fees
Suppliers will be required to “have a fair, transparent and reasonable policy to determine the amount requested from customers as deposit” and suppliers will be required to “ensure that penalties for breach of contract are not disproportionate and unduly onerous.”
This is grand in theory, but a supplier may think €300 is rather reasonable, while a customer may think it is unduly onerous! So we think the CER could be a little bit more prescriptive here but we're sure this rule will get tested fairly quickly after it takes effect…
11 - Vulnerable Customers
The CER has brought in a dozen new protections for vulnerable customers to ensure that they are identified, protected, and only provided with deals and tariffs that are suitable for them. The CER has gone even further and said that if customers become vulnerable while they are within a contract with a supplier they should be released without penalty. And if they have a prepayment meter, they should not have to pay penalties to be released and they should not have to pay to have the meter removed.
12 - Notices of changes to terms and conditions
Starting in the New Year, if your supplier decides to change your terms and conditions, they’ll need to give you 30 days notice of the change and tell you about it properly. So no longer will a supplier be able to make the change, not tell anybody, and say you should have checked their website to see if the terms and conditions had changed (this really happened). Now suppliers will have to give at least three different types of notice such as a letter, a bill insert, a text message, an email, or a broadcast or print ad.
There are many more rules coming into effect that offer substantial protection to energy customers and they can all be seen here. Happy reading!