Citizens Advice response to the consultation on strengthening the economic regulation of the energy, water and telecoms sectors
Citizens Advice welcomes government’s focus on improving economic regulation in these sectors. The role of economic regulators in the coming years will be crucial. It is essential we have a regulatory regime which is fit for the challenges of protecting consumers, delivering value for money, growing the economy and meeting net zero.
In this response we respond in our capacity as the statutory consumer advocate for energy though some aspects apply across other sectors where specified.
We strongly welcome proposals to:
introduce a multi-sector priority services register (PSR) to make the disclosure of information and to receive appropriate support and services easier and more consistent for consumers.
Encourage greater use of comparative performance targets and create a more competitive environment among monopoly companies to drive better value for money and performance improvements.
Enable the CMA to have greater flexibility in energy appeals and strengthen the rights of interveners who represent consumers and the public interest.
However, we believe there are a number of gaps where reform to economic regulation is needed:
Address regulatory asymmetries between regulated companies and those who represent consumer and the public interest to deliver better outcomes for consumers.
More ambitious reform to the energy appeals regime that addresses the significant barriers to consumer representation in appeals, the issue of cherry-picking inherent in energy, and appeals being a routine low-risk game.
Better targeted energy bill support through a tiered Warm Home Discount (WHD), with expanded eligibility and differential support based on energy need.
Ensuring that changes to the infrastructure planning which lower risks for investment are reflected in setting returns.
Further review of UKRN guidance on the weighted average cost of capital (WACC) to ensure that consumers are not funding returns which are too high or too low, and public trust is not jeopardised.
Looking at a consumer duty (as introduced in the finance sector) both within the sectors that are regulated but also for the regulators themselves.
Ensuring there are statutory consumer advocates across all sectors to ensure the consumer voice is adequately represented.