Energy firms warned on complaints

Energywatch said consumers were being let down by suppliers

Gas and electricity retailers must take complaints more seriously, a consumer watchdog has said.

Energywatch said it takes an average of seven months to resolve problems, leaving 97% of customers dissatisfied.

It called on the regulator Ofgem to seize what it described as a "unique opportunity" to make sure companies meet basic standards.

The Energy Retail Association said Energywatch's data showed complaints have already fallen significantly.

'Long way to go'

Energywatch surveyed more than 1,100 customers who contacted its helpline between July and November 2007 after trying unsuccessfully to resolve the problem directly with their provider.

When consumers have a problem they need to be able to make effective complaints Allan Asher, Energywatch

In almost every case, suppliers had not delivered what they promised to customers, failing to fix the issue, send an accurate bill or even just return a call.

Only one in seven of those polled said they were confident their supplier would successfully rectify future problems.

"Everything is designed to put consumers off," said Energywatch chief executive Allan Asher.

"When consumers have a problem they need to be able to make effective complaints and get the problem sorted out."

While acknowledging some progress has been made, he said the industry as a whole had "a long way to go" before consumers could be confident that their complaints would be dealt with professionally.

The energy regulator is set to publish new proposals on complaints handling next month.

Energywatch wants Ofgem to compel firms to meet tough standards ahead of the watchdog's closure in October, when it will be replaced by a revamped National Consumer Council.

Progress

The Energy Retail Association (ERA) said it was unsurprising that the majority of callers to Energywatch were dissatisfied with their supplier.

"A more significant statistic is the 70% drop in complaints Energywatch has recorded over the past five years in all areas, including doorstep sales, switching and billing," said ERA chief executive Duncan Sedgwick.

"The industry has already established the Energy Supply Ombudsman scheme, a billing code, a code of practice for doorstep sales and a set of principles on complaint handling to which all suppliers subscribe," he added.

He said the industry had already begun a "refreshingly positive dialogue" with the new National Consumer Council, and would continue to work closely with it in the future.

A spokesman for Ofgem confirmed that the regulator would publish its final proposals "shortly", and said they were likely to address many of the issues raised by Energywatch.

Misleading claims

Separately the Advertising Standards Agency (ASA) criticised British Gas for making misleading claims about its green energy tariff, which it described as "zero carbon".

A number of viewers complained that this was factually inaccurate because the energy would still generate carbon emissions.

Small print acknowledged the "zero" rating claim "relates to carbon offsetting schemes", but the ASA ruled that could be misinterpreted.

It also criticised British Gas for claiming that its deal was "the greenest tariff compared to those on the Energywatch website".

Energywatch did not rank the tariffs and so British Gas did its own comparison. The ASA said its claim could not be proven since it had not been audited by an independent authority.

British Gas said it "fundamentally" disagreed with the ASA's decision.

A spokesman said the advert made clear to consumers that the zero carbon of the name was achieved through carbon offsetting schemes.

Similarly, it said its statement that British Gas offered the greenest domestic energy tariff was based on "objective data" taken from the Energywatch website, and it was "disappointing" that the ASA had failed to acknowledge this.