Tom Fleming (Kerry South, Independent)
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Question 47: To ask the Minister for Communications; Energy and Natural Resources if he will examine the way electricity and gas companies market their products to domestic users; and if he will establish mechanisms that provide greater transparency and accessibility to information with regard to the various prices on offer from the different suppliers (details supplied). [37435/11]

Pat Rabbitte (Dublin South West, Labour)
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Responsibility for the regulation of the electricity and gas markets is a matter for the Commission for Energy Regulation, CER, which is an independent statutory body. I have no statutory function in the regulation of marketing for either the business or domestic sectors.

The regulator has informed me that it is in the process of outlining procedures for clear and comprehensible presentation of tariffs to domestic customers. The regulator requires all suppliers to put in place a marketing code of practice, setting out all their practices and ensuring that the information they provide to customers is accurate at the time of distribution. The regulator is currently consulting on its guidelines in regard to marketing, with a view to strengthening the protection for customers.

Contained in the consultation is a proposal to standardise the way in which suppliers present tariffs to customers to ensure that customers can compare offers. The regulator also recognises that, as the markets develop, suppliers may choose to offer different products with different types of discounts and services associated with them. In order to ensure that customers can understand and compare the tariffs they are being offered, the regulator considers it appropriate to put in place requirements regarding the presentation of tariffs. This will ensure a level of consistency for customers when looking at different information. The regulator is also proposing that suppliers must notify household customers of changes to tariffs 30 days in advance of the changes taking place, with the exception of where a customer has signed up to a more flexible tariff. This is to allow customers the time necessary to shop around and consider their options in advance of any changes taking place.

Furthermore, the regulator stipulates in its proposed code of practice on marketing that suppliers adopt a transparent and fair approach to the marketing of their products and services and in the arrangement with customers. This includes ensuring that agents do not provide misleading information or apply undue pressure to any person in order to gain a customer.

Additional information not given on the floor of the House

Suppliers must take all reasonable steps to ensure marketing material is easy to understand, accurate and specifies clearly the product being marketed and the period it covers.

To aid the process of price comparison, the CER recently launched a system for accrediting websites that compare energy suppliers' gas and electricity prices. Under this framework, a website providing an energy price comparison service will only be accredited by the CER if it meets defined standards, for example, in terms of its accuracy and reliability. This will help provide energy customers with the confidence to use these websites, assisting them in "shopping around" for the best tariff deal.

Price comparison websites can be an invaluable tool in helping energy customers to decide the best deal for themselves. To assist customers in reliably comparing different energy tariffs, the new framework will accredit a price comparison website only if it meets certain prescribed standards, such as independence, impartiality and accuracy. There will also be a monitoring system whereby any CER-accredited website that fails to meet these standards will have its accreditation removed. This should help energy customers in comparing tariff offers and in getting the best deal to suit their needs.

Tom Fleming (Kerry South, Independent)
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I welome the Minister's announcement that the energy regulator is putting in place new procedures for a marketing code of practice etc. This is not before time. There are four companies operating in the gas and electricity sector - ESB Electric Ireland, Bord Gáis, Airtricity and Flogas. These suppliers do not make it very clear that their headline offers are for new customers only, and that after the initial contract period elapses one reverses automatically to the standard prices. There appears to be no requirement on the supplier to notify the customer when the initial offer elapses. Thus, the supplier benefits from the inertia of people who do not have the time to clinically analyse each monthly bill to see what is happening with the rates they are being charged. They might think their initial teaser rates are still operating when they have actually expired.

Pat Rabbitte (Dublin South West, Labour)
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I agree with the Deputy. It is very important that there is sufficient transparency to allow customers and competitors to compare and contrast. The Deputy is correct about that. Of course, this market has seen changes in recent years and there is now competition in it. In those circumstances, it is important that there is the ability to compare and contrast and that there is adequate transparency. It is timely that the regulator will promulgate these codes, and I welcome that.

Tom Fleming (Kerry South, Independent)
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Energy prices have already increased by approximately 25%. Weather conditions this winter might be similar to those of last year and the previous year. Consumers have benefited from a reduction of 20% when they switch supplier and statistics show that about 50% of them have switched. If they get a 20% deduction, by next spring they could be facing an increase of 45% when these offers are removed. I am sure the Minister will keep in contact with the regulator to ensure that in these straitened times customers will benefit over the next number of months to the maximum extent from the deregulated market.

Pat Rabbitte (Dublin South West, Labour)
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I can give the Deputy that assurance. It is the case that due to various global developments the price of the raw material being imported into this country has risen dramatically. That has had the effect the Deputy described on domestic prices. That will be especially difficult if we have as severe a winter as last year. I am happy to point out that since the new Government took office the weather has improved and November this year was quite mild.