Although energy customers will see a welcome fall in their bills come April after the latest price cap announcement, debt remains a major concern for the sector. So earlier this month, Energy UK held a virtual event with energy suppliers, Ofgem, Department for Energy Security and Net Zero (DESNZ), Citizens Advice, Money Advice Trust, National Energy Action and StepChange to look into how suppliers are meeting the voluntary commitments set out in the Winter 2023 Voluntary Debt Commitment.
Prior to the event, all participating suppliers confirmed their compliance with the Commitment. Following this, we wanted to ensure that learnings were shared between suppliers and challenges highlighted. The event provided an opportunity for suppliers who signed up to the Commitment to demonstrate the processes they have put in place to meet the five key elements of the Commitment, and how they are improving customer experience and outcomes.
The event centred round three themes covering the main areas of the Commitment. These were: treating customers in debt fairly; helping customers take control of their bills; and delivering financial support. Each supplier presented on each theme, allowing them to have an opportunity to speak with, and learn from, all other stakeholders.
Below we summarise the key findings under each theme.
Theme 1 – Treating customers in debt fairly.
These sessions considered how suppliers ensure their customers in debt are treated fairly, through their interactions with staff as well as any direct changes or reviewed internal processes to improve their handling of customer debt cases. This theme covered the Commitment’s requirement for supplier policies determining if and when to use a County Court Judgement (CCJ) or high court enforcement, to be signed off at a senior level. Some suppliers have decided not to use these routes, while others are taking extra steps to ensure full checks are completed so that all relevant customer information aligns with the external reports and that the appropriate criteria have been met.
Key measures shared through these sessions included the specialised training offered to front-line staff on how to best manage customers in debt, as well as those who are worried about potentially getting into arrears. Suppliers discussed how they monitor and identify where there may be gaps in their staff training, such as through collecting data directly from their front-line advisors, and how training in these areas is then implemented through all levels of the company.
The challenges that front-line staff face due to the complexity of the phone calls they are receiving from customers in debt were also highlighted, something suppliers have in common with the charities and consumer groups taking part. Alongside this, call waiting times were also addressed, with many suppliers detailing additional investment to increase capacity to tackle this.
Theme 2 – Helping customers take control of their bills.
Suppliers are undertaking many different initiatives to help customers take control of their bills, with a key focus being on energy efficiency – helping customers to reduce their demand, and therefore their bills. We heard about innovative projects like suppliers providing thermal cameras to customers to identify areas for improvements and working with technology companies to provide and deliver tailored energy efficiency offerings.
As well as this, 1.6 million customers have participated in the National Grid Demand Flexibility Service which allows customers to earn rewards for shifting electricity usage outside of peak demand hours. To support this, some suppliers are also offering benefits for those participating, such as free weekend energy, prizes, and bonuses.
We also heard about the importance of energy suppliers having partnerships with charities to support their engagement with customers. This includes debt advice and income maximisation support, with a focus on the large number of unclaimed benefits. Suppliers have been working closely with a range of charities and third-party organisations to ensure that customers in debt are receiving a longer-term solution rather than a short-term fix.
Discussion also touched on the role of smart metering as a key tool to help customers manage their bills and monitor their consumption with a related theme being how prepayment meters (PPMs) can be a key tool for some customers to prevent them from getting into debt, with PPM customers now also able to access the demand flexibility service. Suppliers highlighted the importance of smart PPMs as a key factor in helping customers take control of their bills, emphasising the need to help them understand the potential benefits of smart meters.
Theme 3 – delivering financial support
Energy suppliers continue to increase the support available to customers struggling to pay their bills. This includes discretionary support alongside the mandatory schemes – such as Energy Company Obligation (ECO) and the Warm Home Discount (WHD) – and can incorporate payment holidays, restructured payment plans and credit advances to customers on PPMs.
All suppliers offer additional financial support to customers totalling tens of millions of pounds on top of the more than £1 billion in mandatory schemes they deliver every year. An area that suppliers have worked on widening the criteria and increasing flexibility around grants and funds for customers, with some suppliers noting that their support schemes are not limited to their customers.
A challenge, which also featured in earlier discussions, is overcoming the challenge of lack of trust in the sector and the need to improve engagement when delivering financial support. Additionally without suppliers being aware of their customers’ situations, it can be difficult to tailor communication to ensure that they are receiving any support they are entitled to. As the language used is critical in communicating with customers, several suppliers are making use of experts to improve the customer journey when delivering financial support. Many were keen to do more work in this space too.
Attendees also discussed the importance of having a holistic approach, ensuring that practical, data-driven approaches are used to respond both proactively and reactively, with some suppliers highlighting the different data sets they use to help identify vulnerable households. The importance of suppliers having good relationships with charities and third parties was again highlighted, focusing on how these two-way relationships should work and can be improved to be most effective. An important point here was about suppliers monitoring progress when directing a customer to a charity or a third-party organization,. underlining that they retain responsibility for the customer and that signposting is part of a joined-up solution rather than an attempt to pass on the problem.
Following the event, we received valuable feedback from attendees highlighting its success in facilitating best practice sharing and identifying key challenges relevant to both suppliers and stakeholder attendees. This high level of engagement reflects the shared dedication to the Commitment, and we fully appreciate the participation of all involved and their determination to bring in further improvements.
There is support available if you are worried about paying your energy bills. To find out more and how to contact your supplier, visit Energy UK’s webpage – Support with energy bills.
If you have any questions, please contact darcy.collings@energy-uk.org.uk
Darcy Collings, Policy Manager at Energy UK