Energy companies drew more than 5.5 million complaints from customers last year

Call for full energy market competition inquiry

Energy companies received more than 5.5 million complaints last year, prompting calls for a full competition inquiry into the “broken” market.

Watchdog Which? Made the call after the first full year of official figures from energy companies revealed they drew 5,579,665 complaints from customers on issues ranging from bills and metering to customer service, switching and payments.

Which? said the Office of Fair Trading and Ofgem should refer the market to the Competition and Markets Authority for investigation into whether competition was working for consumers and how it could be increased to deliver trust, transparency and fair prices.

Which? executive director Richard Lloyd said: "Millions of people are unhappy with the service they receive from the suppliers which, combined with low levels of trust, is yet more evidence that more must be done to fix the broken energy market.

"Next month we want the regulators to refer the energy market to the Competition and Markets Authority and launch a full scale inquiry. This is the first and most important step towards a more radical reform of the energy market, giving hard-pressed consumers the confidence that they are paying a fair price."

Of the 5,579,665 complaints in 2013, Npower received 1,383,650 – the most of all six companies – but they were followed closely by EDF with 1,240,005, British Gas with 1,235,550 and E.ON with 929,230. SSE and Scottish Power received 482,582 and 308,648 complaints respectively.

The fourth quarter of last year drew the highest total number of complaints, when 1,492,065 were received.

Which? said the latest complaints figures from the six companies – who handle 97 per cent of the market – were "yet another indication that the energy market is not working for its customers".

The watchdog's latest figures show that eight in 10 consumers are worried about rising energy prices and just one in five trust gas and electricity suppliers.

Which? said it wanted to see an industry "that works for customers as well as shareholders, where prices are kept as low as possible and people can trust companies to give them a good deal".

Aside from the competition investigation, the watchdog's new campaign calls for energy companies' supply and generation businesses to be separated and for simple pricing and swifter switching to be introduced to help consumers find the best deal.

It said the Government must control costs added to consumers' bills while energy companies must make sure that charges for not paying by direct debit are cost reflective and should not hold onto high levels of customers' cash when they're in credit.

A spokesman for Ofgem said: "We are already putting in place the most radical reforms to the energy retail market since competition began to make it simpler, clearer and fairer for consumers.

“As part of this, we have set suppliers enforceable standards of conduct so that they treat customers fairly. We therefore expect suppliers to raise their game on customer service, and if they don't, our reforms are making it easier for consumers to vote with their feet and switch.

"Together with the Office of Fair Trading and the Competition Markets Authority we are carrying out the first annual assessment of competition in the energy market. The assessment will be completed at the end of March and we will report the findings shortly after."

He added: "The number of complaints is far too high and this reflects both poor company performance in 2013, especially from Npower, and low levels of trust. The onus is now on suppliers to use our reforms to re-build customer trust.

"Customer service is extremely important and Npower's performance is of deep concern to us. We have made it clear that Npower must improve its record on complaints and we have ordered them to report their progress to us regularly. Npower has accepted its failings, apologised to its customers and committed to making sure that no customer will be left out of pocket.

"We haven't ruled out further action on Npower complaints. We take supplier performance on complaint handling very seriously and in 2011 we fined British Gas and Npower £2.5m and £2m respectively for poor performance in this area."

Npower said: "We know we let many of our customers down following issues with our new billing system and, right now, our priority is to put these issues right.

"Since we issued a public apology to our customers at the end of last year, we have been reporting to Ofgem. We are making good progress and will soon be able to give an update on where we have got to. Looking at Which's proposals, there are many elements that we support and several that we are already doing."

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