An independent Scottish electricity company has challenged SSE to explain why it has far more of its customers on the most expensive tariffs compared to any other supplier.
More than 90 per cent of SSE customers – many of them in the North of Scotland – are on Standard Variable Tariffs which are widely condemned as the main source of excessive energy bills.
Paul Richards, managing director of Clydebank-based Together Energy, said that SSE’s use of Standard Variable Tariffs reflected “a cynical abuse of customer loyalty to the Hydro legacy”.
He also warned that SSE’s decision to combine its retail business with that of npower could lead to further “cost, chaos and confusion” for customers while the two systems are being merged.
Npower has the second worst customer service record of the “Big Six” and last year was fined £26 million by Ofgem for failing to meet acceptable standards.
Mr Richards revealed that Together Energy plans to open an office in the North of Scotland in order to provide a locally-based alternative.
He said: “There is an opportunity to get back to the principle of a locally-based energy supplier offering good local service and charging its customers fairly and transparently.
He added: “With this latest move, SSE are turning their backs on the legacy they inherited in the North of Scotland. However, their long-suffering customers are still due an explanation of why more than 90 per cent of them are on the most expensive tariffs, compared to around 50 per cent in the UK as a whole.
“Parts of the Highlands and Islands have the highest fuel poverty statistics in the UK while they are also paying the highest fuel bills. It simply does not make sense and it has a great deal to do with the dominant role of SSE in the market.
“Customers also face the risk of further cost, chaos and confusion when the two companies merge.”
Analysis by Ofgem last year showed that SSE charged its SVT bill-payers – representing 91 per cent of its customer base – 98 per cent more than those on its lowest tariff and 190 per cent more than the cheapest tariffs from other suppliers.
Mr Richards said: “The question which SSE has consistently refused to answer is why, compared to other suppliers, such a vast proportion of their customers are on SVTs. In the North of Scotland, that represents a cynical abuse of customer loyalty to the Hydro legacy.
He said: “Over the past 12 months, SSE have lost 300,000 customers. Instead of responding with a fairer approach, they have effectively decided to ditch this side of their business in order to protect overall profitability.”
Meanwhile, the website Moneyfacts.UK, warned: “Current customers of SSE and npower may want to be even more on the ball when it comes to their energy bills over the next year and keep an eye on what happens in the market. It could be worth comparing alternatives now to avoid any uncertainty.”
The Ofgem report on Standard Variable Tariffs can be found here:
Together Energy is a UK company established to be an energy supplier that consumers can trust. Together Energy was built around the needs of the customer, offering a price-competitive product and a premium service with no additional charges.