The All Party Parliamentary Small Shops Group (APPSSG) has called for sweeping changes in the small business energy market to protect small shops from being abused by their energy suppliers.
Chaired by Priti Patel MP, the Group launched a new report today in which it makes a number of recommendations on backbilling, rollover contracts and third party intermediaries.
It calls for a 12-month limit on backbilling for both gas and electricity, introduced by all energy suppliers, by 1 January 2014.
The Group recommends the same deadline for energy suppliers to end rollover contracts for gas and electricity, with customers placed on a short-term (30 day) variable rate contract if no new terms have been negotiated at the end of a fixed term contract. Suppliers would be required to inform their customers ahead of time of the variable rate tariffs that follow the end of a fixed term contract.
On third part intermediaries (TPIs), the report calls for an enforceable code of conduct to be adhered to by all (TPIs). Under the code of conduct, TPIs must clearly state that they are a broker and the suppliers they are working with at the start of any sales process. Before the agreement of a contract, TPIs must clearly state that they are making a commission and the level of that commission.
APPSSG Chair Priti Patel MP said: “Local shop owners are some of the hardest working people in the country and we must intervene to prevent them being overcharged or forced into unfair contractual terms.
“I know this is a priority issue for the Prime Minister and we hope our report will help to press forward the reforms that are desperately needed. At a time when energy bills are increasing small businesses must not be forgotten when looking at ways to keep costs down and save money.”
The report followed an inquiry session which featured senior figures from a range of energy companies as well as the energy regulator Ofgem. The full report is available here.