Call to ensure firms get ‘fair’ energy deals
14 August 2008 More needs to be done to make sure that energy suppliers deal fairly with businesses, the British Chambers of Commerce (BCC) has said.
The BCC argued that firms are not receiving the same transparent and fair service to which domestic users are entitled. This has left smaller businesses open to exploitation by energy suppliers.
To help protect firms against soaring energy bills, the BCC urged OFGEM, the energy regulator, to address a number of flaws in the way that suppliers treat businesses.
Specifically, the BCC highlighted several areas where domestic customers enjoy benefits that are denied firms.
While energy suppliers must publish the tariffs charged to domestic users, making price comparisons easier, there is no legal requirement for business tariffs to be listed in the same way.
Other customers can switch suppliers with just 28 days' notice, but businesses are often locked into long-term contracts that can last up to five years.
Also unfair, the BCC said, was the immediate binding effect of verbal agreements reached by firms and suppliers, whereas domestic consumers have the leeway of a cooling off period on any verbal commitments.
The position of many businesses is about to become even more vulnerable, the BCC continued, when energywatch is rolled into the new protection group, Consumer First, as from 1 October. The fear is that the new body, which will be covering a range of industries, will not afford firms the same attention as offered by energywatch.
Instead, the BCC wants a new, independent energy watchdog to be set up, one that would be dedicated to the needs of the business community.
David Frost, the director general of the BCC, said: "With the economy slowing and energy bills on the rise, it is totally unacceptable that hard pressed businesses are left so open to exploitation by energy suppliers. OFGEM's investigation into the industry must hold the suppliers to account over the very apparent lack of transparency and fairness in their dealings with business. "Energywatch is currently providing a crucial service to thousands of businesses who are confused and frustrated by energy suppliers. If a super consumer group is to be established, as the government plans, there is little doubt in my mind that this service will be all but lost, leaving companies at the mercy of the suppliers. An obvious solution would be establishing a separate watchdog, dedicated to assisting businesses."
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