European policymakers, consumer groups and energy industry representatives have endorsed a set of voluntary guidelines for good practice in energy billing, in an attempt to placate dissatisfied customers.
The guidelines were presented at the second Citizen’s Energy Forum held in London on 29-30 September. The forum was established to help contribute to the better functioning of the gas and electricity retail markets under the EU’s third energy liberalisation package (see EURACTIV LinksDossier).
The European Commission argues that there is a clear need for simpler and more informative gas and electricity bills as the majority of consumers find it difficult to compare offers from different providers. It attributes this to the fact that only 8% of European electricity consumers have switched providers in the past two years, although less than three in five are satisfied with their service.
“Market opening forces companies to compete for customers by offering attractive prices and good, reliable services. Consumers should be properly informed of their rights and their consumption so that they can actively participate in the energy market. However, information for consumers is not enough to ensure their active engagement,” said EU Energy Commissioner Andris Piebalgs.
The EU executive said that the ten guidelines, which call for transparency and readability, would help EU consumers both to cut down on energy use and save on their bills.
The recommendations include a list of elements that all energy bills should include in order to allow customers to compare offers from different providers. Among these are the duration of the contract and the required notice period for switching supplier, as well as the switching code required to change supplier and a clear indication of the base price per kilowatt hour, which is the main reference for making comparisons.
“These recommendations on energy billing undoubtedly constitute a first step towards more consumer-friendly bills. Billing is crucial in terms of empowering consumers in the liberalised energy market, not least because improved billing practices could help consumers switch suppliers if they wish to, help them save money or develop more environmentally-friendly energy consumption habits,” said Monique Goyens, director-general of EU consumer group BEUC.
Goyens called on the Commission to prepare to turn the guidelines into legislation in case the industry fails to act according to the guidelines.
Eurelectric said that transparent bills based on competitive prices are a prerequisity for consumer confidence. The European electricity industry association stated that to function well, retail markets would require clarification of the roles of the distribution system operator and the power supplier, and customers would need to be given access to accurate information on consumption.
“We believe that the most convenient approach here is to make the supplier the single point of contact for the customer,” said Eric Van Vliet, vice-chairman of Eurelectric’s markets committee.