UK gas and electricity regulator, Ofgem, yesterday sought additional reassurances from npower, the country’s biggest electricity supplier, following an unacceptably high level of consumer complaints concerning its sales staff.
Ofgem said there had been a 26 per cent reduction in the overall level of direct selling complaints, which have been one consequence of deregulation and the desire to bring choice to customers. Complainants refer to aggressive and unfair sales techniques by competing energy suppliers, desperate to increase market share and achieve critical mass.
Npower, a subsidiary of Innogy, had agreed in January to improve the performance of its sales staff who engage in direct sales techniques to persuade domestic consumers to switch gas and electricity supplier. Complaints against npower have continued to run above average, despite the undertaking to improve training of staff and ensure consumers fully understood any contract entered into.
Ofgem’s Managing Director of Customers and Supply, John Neilson, said, “Energywatch is continuing to receive a significant number of complaints about npower’s direct selling activities. We are concerned that the company may not meet its undertakings fully by next January.”
“We have, therefore, asked npower to provide a further report to Ofgem setting out the steps they will take to address the problems being identified by these complaints and their programme for action to fulfil the undertakings.”
Doorstep selling continues to be the main way in which customers learn about new gas and electricity suppliers in their area, but this has led to questionable high-pressure tactics which, in some cases, have left consumers confused and unsure as to what they have signed up to. Ofgem insist that contact be made with the new customer within 14 days to ensure that they are happy, otherwise the contract can be cancelled.
Npower said that its performance had improved since the beginning of the year. David Andrew, director of marketing said, “We expect to see further improvements and are confident we will meet the regulators targets.”
He insisted that any staff found guilty of forgery or making fraudulent claims were dismissed immediately and said that most complaints involved minor errors in form completion, such as misspelling of names. The company currently has over five million UK gas and electricity customers.
Those who have switched supplier appear to be satisfied, with 93 per cent of electricity customers and 90 per cent of gas consumers who have switched agreeing that the process is easy.
Yesterday, US energy company Amerada Hess gave up its chase for UK market share when it announced it would be selling its UK gas and electricity assets. It has 500 000 UK customers – well short of the 5 million other companies have said is needed to make a reasonable return in the sector.