Energy has been prominent in the news headlines again, with the debate shifting onto the importance of supporting small businesses.
Last week Ofgem, the energy market regulator, proposed that the industry should be referred for a full competition investigation. And the Labour leader today has reiterated his call for a price freeze for domestic customers and extended this for small business customers, as well as suggesting a number of other measures to help firms manage their energy costs.
I strongly believe that the business energy market is competitive – customers have access to switching sites and even the smallest business customers can choose from over 10 major suppliers for electricity and 15 for their gas supply – all competing to offer the best prices and contracts for their customers. British Gas Business offers competitive rates and we’re proud that the vast majority of our customers choose to stay with us when they make decisions to renew their supply each year.
I welcome the debate Ed Miliband has opened on business energy – a market which functions very differently to the residential one. Unlike the residential market, most small firms in the business market already have a level of certainty on prices through fixed deals for a year ahead or more. In fact, this year, many of our customers are putting in place contracts lasting at least two years, giving them complete peace of mind.
British Gas Business fully supports a ban to stop the selling of so-called “auto-rollover” contracts. We listened to our customers when you told us you didn’t want to be automatically rolled over onto a contract which might involve higher prices, and which wouldn’t allow moving onto a better rate until that contract had ended. I’m proud that we were the first to end the practice in September 2013. All new fixed term energy products we’ve sold since then are free of automatic renewal. And the old auto-rollover process will be a thing of the past for all our customers by September this year as we implement new billing systems to enable a better approach to pricing.
If everyone stopped selling auto-renewing contracts, the market would become even more competitive and dynamic for customers and there’d no longer be a risk of customers getting “trapped” on a contract because they were too busy to deal with their energy price at the precise moment when their supplier said they had to. That’s an argument we continue to make to Ofgem and one that different consumer groups are aligning behind.
We also support limiting “back-billing” to one year, and we’re putting this in place very shortly – certainly before the end of this year. We know that managing tight budgets is hard and it can be a surprise to receive another bill for a period you thought you had paid. If we, or any of the industry processes involved, were at fault then we won’t ask a business customer to pay.
British Gas Business is working hard to make it easier for our nearly half million small business customers to deal with us. We’ve dedicated an area of our website to help and advice, which we’ve called ‘Making It Easy’. We’re also making our bills and letters clearer. And we’re innovating all the time to make it easier to complete day-to-day tasks, with products like our smart phone app which allows you to submit your business’ meter readings.
For all businesses, energy is an essential and often significant cost. We want to help all our customers manage their costs. So we offer fixed term payment plans at 0% interest, and work with organisations like Business Debtline, who are part of the Money Advice Trust, to offer specialist help when it’s needed most. We’re also passionate about helping our customers reduce their energy consumption. We do this through measures such as installing renewable energy technology, automated heating and lighting controls, and smart meters.
I’m proud of the work we do at British Gas to support the national economy – Centrica, our parent company, supports around 174,000 jobs in the UK, 33,000 in the company itself, 80,000 in its supply chain and 61,000 in businesses which benefit from Centrica employees spending their wages and in the wider supply chain. This economic contribution is equivalent to all the jobs in a city the size of Leicester.
You can find more information about what British Gas and Centrica think about last week’s announcement, but I’m always happy to talk directly about anything you’d like to discuss with me. So if you’d like to get in touch with any questions, issues or ideas, please feel free to email email@example.com or tweet me and we can have a chat online.