Energy Bill Problems - the Solution

Malcolm1948

Just had a daydream, and the obvious solution to all the energy billing problems that plague this and other sites.

We all have a regional distribution company, who actually deliver the electricity/gas we use, deal with safety issues, and who we have to deal with in the event of power cuts, supply issues etc.

Why can't we all pay these companies directly for the energy we use and cut out these unnecessary and frankly incompetent and wasteful middle men? Think of the savings in ombudsmen, marketing, duplicate meter reading and billing costs. Yes, there would have to be regulation to ensure customers were not ripped off and prices were fair, but what we have now is not exactly working for customers either.

It's the system that works for water supply, and in most other countries where utilities are privately owned or have been privatised or semi-privatised.

But then I'm living in the past - its all soooooo much better now, isn't it?

modsandmockers

As you say, the energy retailers actually have nothing at all to do with the production and delivery of energy (even though some of them may belong to a larger group of companies, some of which may be involved in production and delivery). The retail arm of the energy industry is to all intents and purposes a gang of commodity speculators who play the ‘futures’ game entirely to their own advantage. And because the product which they ‘supply’ is 100% identical to the product which all their competitors supply, there is very little scope for any meaningful ‘competition’ to take place. There is no incentive whatsoever for the retailers to offer a reasonable level of customer service because there is very little chance that any household will ever be left without an energy supply. The retailers ‘compete’ by making it as difficult as possible for consumers to be able to decide on the best course of action. The customer is forced to do either nothing at all, or to become a minor sort of commodity speculator in their own right. As you say, the current system is not really any better than the nationalised industry which it replaced.

My water supplier has had the same two tariffs for years, and nothing changes except the price. One tariff has a daily standing charge and, for low users, there is also a tariff with no standing charge but with a higher unit price. The water company takes pains to ensure that each of their customers is on the appropriate tariff.

macman

Water utilities own the whole network, both 'generating' and delivery. Gas and electricity is different, since production and distribution is not under the same ownership, or only partially, even at wholesale level.
So, completely different business models.

victor2

Bring back the gas board and electricity board eh?
Who needs competition?
Not saying the current situation is ideal, but look at people who get their water through one of the more expensive water authorities. All they can do to pay less for the same service is move house to another region...

modsandmockers

macman wrote: »

Water utilities own the whole network, both 'generating' and delivery. Gas and electricity is different, since production and distribution is not under the same ownership, or only partially, even at wholesale level.
So, completely different business models.

It would be interesting to know whether the privatisation of the energy industry was intended to produce the current situation. I would guess that the original idea was that, like the nationalised system which they replaced, each supplier would offer a single price and that consumers would be offered a simple choice and an easy switch.

If it is true that the vast majority of customers never switch, never question their monthly payments and are happy to pay standard variable prices, then privatisation hasn't really worked to the consumers' advantage and the bulk of their customers probably rarely require any kind of 'customer service'.

So long as the majority of customers are happy to pay over the odds for their energy, then the energy suppliers have nothing to worry about. If their customer service and complaints procedures are dominated by us skinflints who form the minority, then it’s not really surprising that they don’t want to spend money in order to make it easy for us.