How we updated our energy star rating so it works better than ever for consumers
This week Citizens Advice has published the first release of its Star Rating using the new methodology. Looking beyond the headlines about which suppliers are performing better than others, we know the new methodology is more helpful than ever for energy consumers.
As we mentioned in our recent decision document on changes to the quarterly assessment of energy supplier performance, we have always had three main objectives behind the Star Rating:
- To provide consumers with accessible information about aspects of energy supplier customer service performance that matter to them
- To enable consumers to make more informed switching decisions
- To encourage competition between energy suppliers based on measures of key areas of customer service
These objectives build on each other. Accessible and easy to understand information for consumers means that they can better assess how energy suppliers might be performing against the issues they care about, which can lead to better switching decisions. Likewise, we want customers to benefit from supplier competition against one another, so switching decisions by those customers can help to encourage suppliers to invest more heavily in customer service areas.
Accessible information for consumers
The Star Rating has always been characterised by simplicity, which we know is very valuable for customers looking for rapid and credible insight into energy suppliers. Performance in key areas of customer service feeds into a simple five-star ranking, and even though a lot goes into the stars, it remains accessible for consumers. The new methodology includes some new measurements, which makes it even more relevant to customer expectations.
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Our research shows that billing and smart metering are two of the most important elements of customer service that energy suppliers provide to their customers, and both are now included within the ranking. The addition of billing means that suppliers now get recognition for their efforts to improve billing processes so that customers are billed promptly and accurately. As the energy retail market becomes more complex and more customers require smart meters to access products and tariffs which are important to them, the addition of the smart meter score means that suppliers are further incentivised to correctly resolve smart meter issues when they arise.
Customer contact
Suppliers are also now marked for a wider variety of contact channels they are actually using, as well as the telephone and email routes they’re required to provide. Those channels are weighted based on how important they are for customers, and particularly customers in vulnerable circumstances. Our consumer research found a changing landscape for contact routes, including the decline in use of social media channels, the emergence of WhatsApp as a route for customer contact, and the use of AI customer service agents. However customers who are facing an emergency situation or who have a complex query still prefer to reach their energy supplier by telephone.
The Star Rating continues to prioritise telephone contacts through higher weightings for calls, broadly in line with the proportion of telephone contact in the market and reflecting the higher importance customers give to this crucial channel. This rewards suppliers who invest in contact routes which can rapidly assist those in vulnerable situations, prevent self-disconnection by those with prepayment meters, and rapidly respond to those with complex queries.
Working in the open
Our decisions on the new Star Rating were informed by close and collaborative work with energy suppliers and other stakeholders. We took all the points made throughout the consultation processes seriously, and while we couldn’t include every suggestion made, we assessed them all against our overarching objectives when making decisions on what to include.
For example, we carefully considered adding customer satisfaction into the measures, but the practical implications of getting data for smaller suppliers in the rating are significant. Our research also shows these scores are heavily linked to affordability and non-service factors which are not relevant for a rating focused on customer service. As such only a minority of suppliers thought we should include it. As a result, while this research informed the design of the Rating we haven’t included the data directly.
The changes in the revised Star Rating means that distinction between energy supplier performance is clearer, and for suppliers, the routes to improve their score are more visible. The introduction of half-stars for complaints means that suppliers who were previously scoring at the lower end of the complaints measure should now have more achievable routes to improve, whilst the addition of other metrics means that suppliers can be confident that investments in other areas of customer interaction can pay dividends in terms of their performance in the table. The fact that there’s clear space between the suppliers in the table under this new methodology means that this is beginning to work — suppliers can see how they can move up, while consumers have a clearer choice between prospective suppliers.
This is important because energy suppliers tell us that the Star Rating can be useful as a tool to facilitate improvements which ultimately benefits customers. By choosing what we measure in the Rating, we aim to secure tangible benefits across the energy market for consumers in the areas of service that matter most to them.
We’d like to thank suppliers and other stakeholders who worked with us through this process. We’re proud of the changes we’ve made to the Star Rating, which mean it continues to drive meaningful improvements for energy consumers into the future.
