Ms Aoife MacEvilly:

I will start by addressing what is happening in the market. We conducted a major review of competition in retail electricity and gas markets in 2017 to examine what was happening, what was working well, what was not working so well and what we could do better. We saw there were many changes in wholesale prices and our customers saw the changes in the retail price. In general, we found that the changes in the retail prices were broadly following the underlying market trends. When prices went down in the wholesale market, the retail price came down following a small lag because of hedging. As wholesale prices have gone back up, we are seeing the retail prices following.

We found that there are benefits to competition and that the customers who switch and are active get the best of those benefits. We decided to examine what we can do, using our existing powers, to empower customers and to get more people active. We did a fair bit of research into the reasons some people do not switch. The Senator is correct that some people may not care and switching may not be a big issue in their household. However, there are customers who want to get better value but are sometimes put off in that they find the task confusing. If people are confused or worried they might make the wrong decision, they step back and do not make any decision.

We introduced three new measures to help support customers. One is called the estimated annual bill. We know from some of the behavioural research we have done that it is impossible for customers to compare two offers where one promises a 25% reduction and the other promises a saving of €300. We required all suppliers to indicate the estimated annual bill a customer would face based on an offer. For example, if in the case of one supplier the estimated bill is €1,000 and in the case of another supplier it is €950, the customers can decide to take the option offering an estimated bill of €950. That is now a requirement in respect of all advertising from suppliers of offers to help customers.

We were aware that customers switch but, as the Senator noted, subsequently revert to a higher standard tariff. This often occurs because they have forgotten or do not realise their account will revert to the previous tariff. A few months may elapse before they get the higher bill and ask why that is the case. We now require all suppliers to send out a notification 30 days in advance of the expiry of the offer period and remind customers it is time to look around or renegotiate. The Senator is right that the issue is not only about switching. We place considerable emphasis on customers renegotiating with their current supplier. As customers come to the end of their tariff period, they should phone their supplier and ask what it can offer as they will otherwise consider switching provider. In many cases, the supplier will make another offer to retain the customer.

The third measure provides that suppliers issue a notice to customers who have never switched and those who have not switched for a long time noting that they have been on the same offer for a long time and that better offers are available and asking if they would like to discuss the matter. These measures were rolled out in different phases earlier this year. While it is early days and it may be because prices are going up, switching levels in October of this year were higher than in any one-month period during the past seven years. We believe the message is getting across.

For the first time, the CRU has had a consumer outreach campaign, Switch On, mostly on social media. Customers might not trust SSE Airtricity or Electric Ireland to give them objective information but we hope they will trust us and we provide such information on our website. Those are the types of activities in which we are engaged. Also, if there are complaints against suppliers, we follow up on them. We audit suppliers to make sure they are complying with the supplier handbook, which is the key regulatory protection for customers. We are quite active in that space.