Energy Suppliers Are Worse Than A Year Ago

Numerous price hikes and poor communication - is it any wonder we are becoming increasingly dissatisfied with our energy providers? A recent survey reveals just how unhappy we are.

Don't you just love energy companies? They make bags full of money while we struggle to cope with rising gas and electricity prices, dreading the arrival of our next bill.

So just how dissatisfied are we with our current energy supplier and the service it provides? A recent customer satisfaction study by J.D. Power and Associates reveals all.

According to the results of the survey, overall satisfaction for gas customers this year has averaged 610 on a 1,000-point scale. That's 16 points lower than in 2007. For electricity customers, the decrease is slightly smaller, but it's still lower, with satisfaction averaging 594 this year - down 11 points from 605 in 2007. 

Moreover, communication from utility companies regarding price increases has deteriorated. The study revealed a massive 54% of utility customers found out about their price increases through the media this year and only 38% of customers actually found out from their supplier. In comparison, last year, 36% of people reported learning about price increases through the media, while 56% were informed through their supplier.

This is disappointing given that many consumers may not have even been aware that prices were going up, or by how much. Having had a nasty shock when their next bill arrived, some people may not have even had the funds to meet their higher bills.

Should I stay or should I go?

The study also revealed that lack of communication from utility suppliers about price hikes can have a negative impact on consumer loyalty.

Among those customers who found out about rising costs through the media, 34% said they were likely to leave their current supplier within the next year. In comparison, among those customers who heard about rising costs through their supplier, 21% said they planned to switch their provider.

Additional findings

With rising prices continuing to place pressure on consumers, the study also revealed the proportion of customers interested in subscribing to fixed price contracts has nearly doubled to 41% for both gas and electricity customers, from 22% in 2007.

Meanwhile, among households that receive both gas and electricity service, 82% use a single supplier for both types of energy in 2008, compared to 79% in 2007. Among these households, 75% receive price discounts for doing so.

What's next?

The main question now is will we see some relief in energy prices next year? In Cheaper Petrol And Gas In 2009, fellow Fool Neil Faulkner suggests we could see a fall in gas bills in around six months, but frustratingly electricity prices may rise before they fall.

In the meantime, if you are considering switching supplier, you might want to look into capping your tariff to protect yourself from further price hikes, at least temporarily. You can read more on this topic in Laura Starkey's article Change Your Energy Tariff TODAY.

On the other hand, as Neil Faulkner has pointed in his article, now may not be the right time to opt for a capped tariff, so you may prefer to apply for the cheapest variable tariff you can find instead.

Take a look at our gas and electricity comparison tool for further guidance and for further advice, check out our archives for more energy articles.

Happy switching!

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