CMA finds room for improvement in business energy markets

The Competition and Markets Authority’s (CMA) investigation into the energy markets has found that a “substantial number” of small businesses are failing to see the benefits of competition.
In a report published on 7 July, the CMA suggested that a high number of small and medium-sized enterprises (SMEs) were failing to engage in the energy markets. Around half of the SME customers of the Big Six have not switched suppliers in the past five years, reflecting either satisfaction with their existing tariff, or inertia. Further evidence collected by the CMA indicated that a substantial minority of microbusiness customers had not arrived on their current tariffs as a result of an active decision.
As part of its market remedies, the CMA proposed that the energy regulator Ofgem should operate an independent price comparison service for domestic and micro-business customers. It has also proposed the introduction of a “transitional safeguard regulated tariff” for disengaged micro-business customers, which would aim to ensure they were receiving a fair price while long-term market reforms were enacted. The CMA is scheduled to deliver its final findings and recommendations before the end of the year.