Here’s a rundown of some of last week’s top stories affecting the broadband, energy and mobile markets:
235,000 customers left stranded as Economy Energy folds
Economy Energy has become the latest (and ninth overall) small energy supplier in the UK to go bust in the last year.
Ofgem has stepped in to handle the situation, and has told the company’s 235,000 customers to take meter readings as they organise their transfer to a new energy supplier.
The news of Economy Energy’s demise will not come as a shock to many, as the company had only days earlier been banned by Ofgem from taking on new customers due to serious customer service shortcomings.
The failed company offered no real apology to their customers in a statement on their website, but assured them that supplies and any credit balances will remain unaffected:
“Economy Energy has ceased to trade. Ofgem, the energy regulator, is appointing a new supplier for its customers. Customers need not worry, their supplies are secure and credit balances are protected.
“Ofgem’s advice is not to switch but to sit tight and wait until the new supplier has been appointed. This will help make sure that the process of handing customers over to a new supplier and honouring credit balances, is as hassle free for customers as possible.”
Ofgem to tighten up regulations for gas and electricity supply market entrants
In light of the demise of nine recent entrants to the gas and electricity market, Ofgem has announced that it will introduce more rigorous tests to ensure newcomers are well equipped to deal with the “challenges of the market”.
Ofgem’s executive director for consumers and markets, Mary Starks, explained that newcomers would face more stringent background checks and financial capability assessments.
Speaking on BBC Radio 4’s Today programme, Starks said: “we do think there is room for improvement in the licensing regime and we are conducting a review of our licensing arrangements at the moment, with a view to strengthening our requirements to raise standards in a couple of areas, particularly around customer service and financial resilience,”
Consultation is under way and new rules start to be introduced in April.
Despite the failings of some smaller energy companies, she believed opening up the market to new players had benefited consumers with greater choice and better prices, and praised the new price cap that came into effect at the beginning of this year as having aided this too.
BT Mobile and Broadband prices to be linked to Consumer Price Index
Over the last few years BT had been increasing prices around every 9 months, with rivals following suit a few months later.
Previous rises would usually total to around 4-6% per year, far beyond the standard rate of annual inflation measured by the CPI which, in November, stood at 2.3%.
It’s a bold move by BT, as some experts predict that the CPI could turn negative towards the latter months of 2019, depending on the outcome of Brexit.
Using the CPI as a base for price increases is also a peculiar move, as most Mobile Network Operators tack their prices to the Retail Price Index – which is usually much higher.
Even though the terms and conditions for new and renewing customers come into effect immediately, the new pricing structure will not be applied until March 2020. It will be calculated according the CPI rate in January of that month.
This new pricing structure will give customers more predictable price increases – a welcome change from BT’s previous method of hiking prices aggressively.
Failing to haggle with your TV and broadband supplier could be costing you up to £690 annually
A Which? survey has revealed that 40% of customers who remain loyal to their broadband provider for more than 10 years could be grossly overpaying for their services.
Providers typically bring new customers in with cheap introductory prices before hiking fees up around the 12 or 18-month period.
Savings averaging around £180 per year could be made simply by negotiating with your current provider when your contract comes to an end, and larger savings can often be made by switching to an entirely new provider.
Sky customers who fail to haggle are being hit the hardest. They’ll be paying an average of £1050 annually, whereas customers who haggle pay £120 less at £930 per year. Sky does, however, provide the most channels for its most basic package (300 channels).
Virgin Media customers pay less on average than Sky customers, paying around £960 per year. As with Sky, hagglers pay much less for the same service, averaging around £780 annually (saving £180 per year).
BT customers can see the most savings by haggling. Negotiating with BT can save you an average of £210 per year, paying an average of £510 a year, compared to the £720 typically paid by those who don’t haggle.
New customers are the ones given the best deals overall, so if you aren’t particularly bothered about who provides your services it is worth shopping around for a new deal.
Ultra-fast electric vehicle charging sites to be rolled out in Scandinavia
48 ultra-fast charging sites for electric vehicles are to be set up in Denmark, Sweden and Norway. The project is being undertaken by German energy giant E.ON and Danish e-mobility provider Clever. The sites with the ultra-fast chargers are to be opened up along motorways in Scandinavia.
28 sites will be set up in Denmark and Sweden, with the remaining 20 in Norway. The companies are in agreement with the EU to co-finance the 28 sites in Denmark and Sweden.
The charging sites are due to be operational by 2020, with customers of Clever, E.ON and even third parties all able to use the stations.
CEO of Clever, Casper Kirketerp-Møller, said: “This is a major leap forward for Scandinavian and European EV drivers alike. With this new joint venture, we’re journeying into the new era of borderless sustainable e-mobility.
“Only two years ago, this was a vivid dream on Danish soil of connecting people by frictionless, limitless, rewarding EV experience and now we’ve been granted the green light from the European Commission, with several ultra-fast charging sites sprouting throughout Denmark, Sweden and Norway.”