How fit for the consumer are today’s flexible electricity contracts?

BEUC NEWS - 03.04.2019

In the coming years, the EU expects a big take-up of the kinds of contracts where the consumer has their electricity consumption increased or decreased according to the time of day to benefit from lower prices. There are companies that already offer these kinds of services, but because of their novelty, we wanted to know how consumer-friendly their offers are.
 

Today we publish an analysis of 6 companies in 5 markets in the EU. We found that there were positive clauses in some of these contracts, but there were also some very worrying ones which need to be removed if this market is expected to develop.

Click here to read the report .

We paid particular attention to clauses related to price calculation (tariffs and rewards), data protection and contract termination/switching.

  1. Several companies have good, although sometimes complex, information available on their pricing policies. Others make very unclear references to the market price and fail to specify what it is.
  2. None of the contracts had data protection policies that would be acceptable from a consumer perspective. Companies should make much more effort to be fully GDPR-compliant.
  3. We observed some rather old-fashioned contract terms and conditions – including clauses that could lock consumers in and which included unclear information and disproportionate termination fees.

To further inspire companies in the preparation of the most consumer-friendly contracts possible, our analysis includes several recommendations and model provisions on privacy, switching, contract termination and some guidance on informing consumers about the price or rewards possible. It also includes recommendations for authorities to ensure these offers deliver to consumers.

We contacted all companies and provided them with the opportunity to comment on our analysis. Nearly all companies reacted. Several of them engaged with us in a constructive way and acknowledged shortcomings in their offers. A few companies promised to change several clauses we found problematic which illustrates that this analysis is not only timely but that it is important for the development of flexible electricity offers.