Problems with companies who mis -sell energy on the doorstep

1. Problems with companies who mis-sell energy on the doorstep Energy Policy into Practice: slides for advisers

2. What’s the issue? • Doorstep mis selling has been a big issue for many years – complaints peaked at over 1000 a month in 2002 • Complaint numbers have fallen but mis selling is still a big issue for consumers, causing detriment and undermining confidence. • Ofgem research in 2008 found that over half of consumers switched to a more expensive deal after a doorstep sale • Consumer Focus research in 2009 found that 34% of consumers who had experienced energy doorstep sales found it intimidating • 2010 Ofgem introduced a new license condition (SLC 25) aimed at ending doorstep mis selling • September 2010 – Ofgem announce an investigation into four energy suppliers for potential breaches of this license • 2011 following Consumer Focus research in to doorstep selling, five of the Big six agree to stop doorstep sales

3. Who says what? “We must put a stop to consumers finding themselves intimidated or misled into switching energy providers only to end up paying higher or duplicate bills for months on end - “there is now only one real solution - banning energy doorstep selling altogether.” Trading Standards Institute, 2009 “The introduction of the Code and the EnergySure Scheme has delivered major improvements in doorstep selling practices in the last six years.The industry is working hard to stamp out all rogue traders while encouraging best practice and high standards in energy selling practices.” The Energy Retail Association, Introduction to the energysure code of practice for face to face sales “If better advice for customers and enforcement of the tougher rules doesn’t end the flagrant abuse of this form of selling the big question will be whether it should be completely banned” Consumer Focus response to Ofgem announcement to investigate four energy suppliers for mis selling, September 2010 "Since we announced a halt to unsolicited doorstep selling, feedback from our customers and staff has been very encouraging,“ Ian Peters, British Gas, 2011 “given the prominence of telesales and face-to-face sales as a means of switching it is important that consumers are sufficiently well informed that they feel able to take correct decisions” Ofgem, Retail Market Review , March 2011

4. The consumer experience CurrentCommon mis selling complaints: • Agents taking advantage of the vulnerable, including the elderly and the infirm • Agents making reference to Ofgem/the Govt in a way that suggests official support for statements • Agents suggesting to consumers that they can save money because their company is the DNO for a region • Agents ignoring No Cold Calling Zones and claim they are not selling • Agents gaining access to a premise on the pretext of needing to take a meter reading The Future • The roll out of Smart Meters and the Green Deal could allow new types of mis selling to occur

5. Policy challenges? • Outcome of the Ofgem investigation of four energy suppliers for potential breaches of SLC 25 • Potential guidance on the Consumer Protection from Unfair Trading Regulations for the energy sector • 2011 five of the Big Six announce a halt to unsolicited doorstep sales • Go live of the smart meter roll out – 2012 • Launch of the Green Deal - 2012

6. Want more information? • Consumers who have experienced mis selling on the doorstep should call Consumer Advice consumer serviceon 0845 4 04 05 06 • Energysure code – the industry voluntary code of practice http://www.energy-retail.org.uk/salespractice.html • Consumer Focus advice on switching energy supplier http://www.consumerfocus.org.uk/get-advice/energy/advice-leaflets