It is great news to hear that forensic accountants are going to examine the wholesale purchase prices of energy to try and identify if consumers are getting a fair deal.  However is this really going to help?

Increasingly suppliers are using the tactic of what could be termed “price confusion” to lull consumers into paying more for their services or products.

Supply of energy, that is gas or electricity, should be quite easy to price.  There are peak periods and off peak periods, each has a tariff, and that should be it.  But not for our energy suppliers, they want to create as much confusion on pricing as possible so that can get consumers to pay more.

So suppliers introduce multiple tariffs; energy saver plus, online energy saver plus2, super saver gas plus electric, online energy saver3, etc, etc, etc, … you get the point. At the end of the day all of these “products” are the same thing, energy in the form of gas and electricity, energy does not vary  in colour, taste, weight, etc, its just energy, what is so complicated about that?

Then the consumer signs up to one of the many tariffs thinking they have a good deal.  Next month the suppliers say, hey, wait a minute, we have got lots of people signed up to our online energy saver plus2 tariff, so lets increase that one and make the others cheaper.

And so it goes on.  The suppliers of energy will make inflated margins until regulation is applied.

Maybe what we need is a single tariff, like a price for electricity and a price for gas, followed by an overall discount which they can vary from time to time at the supplier’s discretion.  This would make it much easier for consumers to select on price.  So how about it regulators?