Access Denied Digital disadvantage and exclusion in the energy market

Access Denied Digital disadvantage and exclusion in the energy market 1.09 MB

Digital services are revolutionising many areas of our lives. They provide new products, more choice and tailored experiences for consumers, and can reduce operational costs for businesses. But in a world where services are increasingly delivered digitally, people who are digitally disadvantaged can struggle to participate.

Digital disadvantage occurs when one person or group of people receive different, more harmful experiences of digital services when compared to others. It encompasses a range of elements from inclusion to skills and attitudes, and is closely linked to broader social disadvantage, with digitally disadvantaged people sharing many characteristics around age, education, disability and deprivation as well as other characteristics which contribute to vulnerability.

It is becoming increasingly difficult for this group of consumers to take part in the energy retail market: it’s more challenging to choose a new supplier and get the best deal without using price comparison sites, and many suppliers have shifted their customer services to rely heavily on online channels. Some suppliers have launched without a telephone line at all. This trend is likely to accelerate in future as energy products become more complex and reliant on smart energy technologies.

Our research has found that digitally disadvantaged consumers are at much higher risk of loyalty penalties, while the offline services they rely on are getting worse. Over time these consumers risk being left behind by changes in the market. While the number of people affected is likely to shrink over time, a significant minority of people will remain digitally disadvantaged through the 2020s.

Read our joint statement on digital disadvantage with Age UK. 157 KB

This is a social issue that requires broad action from government to resolve, but there are also steps that energy policymakers and industry should take to ensure fairer outcomes in the market. Overall we need to see action to:

Improve access to digital services by encouraging higher take up of broadband social tariffs among eligible households, and supporting people who struggle to use digital services

Enable digitally disadvantaged people to get good outcomes in energy by reducing the risk of loyalty penalties, providing affordable energy to those on low incomes, ensuring that they benefit from smart meters, and that innovative new products take account of their needs

Ensure energy services are accessible and high quality for everyone by maintaining good offline contact channels, making digital services accessible andraising customer service standards overall