Future for all: Making a future retail energy market work for everyone

Future for all:  Making a future retail energy market work for everyone  1.3 MB

For the majority of people, their experience of the retail energy market will not have changed much over recent decades, with a bill from a conventional energy supplier landing on the doormat. However, drivers like digitalisation and technological change mean the retail energy market is expected to evolve rapidly in the coming years. Attractive retail propositions that consumers are confident enough to use will be vital to enabling take up of renewable energy, electric vehicles, low-carbon heating and efficiency measures by households.

There is a real risk that those that can’t engage with the future retail energy market will face paying a disproportionately high burden of decarbonisation costs. There is a need then for protection to ensure the market works for everyone. Recognising this, the government and the energy regulator are reviewing the arrangements for the energy retail market. A fair future retail energy market must ensure that all consumers are not unnecessarily restricted from accessing products and services, and have a good range of choices, while also protecting those who do not engage. Accessibility is important because it ensures choice, fairness, and a good chance of getting the best deal.

This research is centred on identifying barriers to participating in a future market, and making sure these are minimised. The qualitative phase of the research identified some appetite for new offers in the market, particularly those that enable consumers to purchase local and renewable power. Participants recognised problems with the traditional model for buying energy, such as rising prices and a lack of clarity on billing. But people also had some key concerns around new models related to the risks of giving up control, alongside a reluctance to invest more time in their energy supply and a desire to keep it simple.

Alongside this, the desk-based phase of the research identified some major barriers to accessing offers in a future market, including digital exclusion, financial barriers, and issues around consumer engagement and trust. Other barriers, such as those caused by housing characteristics and tenure, affect fewer people but are nonetheless important to tackle. The issue of vulnerability also cannot be seen in isolation - especially as new forms and formats of energy supply could give rise to new circumstances in which people find themselves vulnerable.

To achieve a fair, inclusive future energy market, barriers to engagement will need to be overcome through action by businesses, regulators, government and third sector bodies. We set out a number of detailed recommendations to ensure as many people as possible can benefit from the retail energy market’s evolution. 

Here is the research the policy report is based on:

How Accessible are Future Energy Supply Business Models? A Report for Citizens Advice 1.64 MB

Citizens Advice Future Energy Models Report  3.43 MB