Setting the Record Straight: ECA Responds to Misleading Article in The Times

Setting the Record Straight: ECA Responds to Misleading Article in The Times

By -Published On: April 19, 2023-Categories: Business, Energy Consultants, Market Insight, News-

Setting the Record Straight

Dear valued members of the ECA community,

We recently became aware of an article published on Monday April 17th, claiming that energy suppliers in the UK, including British Gas and SSE, are facing a £500 million legal claim over alleged “secret fees” paid to brokers.

We wanted to address this issue and clarify any misconceptions. The response to the article that we sent to the author at The Times, is as follows:

Our Response

Dear Sir / Madam,

The above-referenced article contained a number of materially incorrect statements. Incidentally, you covered the same story a few weeks ago so I’m assuming this is simply paid content.

First, you state the average claim to be £60,000 – this is ludicrous. Energy brokers charge fees usually by a commission which gets added to customers’ bills. This is by a unit rate uplift. The typical average uplift over the past few years has been around 1p. 

A commission would be calculated as uplift (1p) X Average annual consumption of energy X contract length.

The typical UK business uses less than 60,000 KWH of energy and would usually enter a 2 or 3-year deal. At 1p per KWH, this creates circa £1,800 in commission. 

Second, you state that Ofgem has “highlighted “the practice of energy companies paying secret commissions to third-party energy brokers. Because the commissions were hidden in energy contracts, they were said to be a breach of the fiduciary duty to the customer.” 

This is again untrue. Ofgem has never made such a statement nor commented on the fiduciary duty – if one exists.

This is a complex legal matter yet to be tested in court and sensationalist reporting to help the claims companies isn’t helping the end customers. 

Finally, these companies are using loopholes in the Claims Management Regulations and acting without regulation – often running spurious arguments and wasting huge amounts of time.

The trade body you asked to comment on is a trade body for energy generators – Not brokers. I’d suggest you contact the ECA which represents the broker’s views.

Regards

ECA Executive Team

Our Insight

The ECA takes the inaccurate and misleading claims in The Times article very seriously.

As a trade body that represents and protects the interests of energy consultants and intermediaries, we are committed to standing shoulder-to-shoulder with our members and advocating fair practices in the industry.

It is important to note that the legal claim mentioned in the article is still under investigation and remains unresolved. Furthermore, we want to emphasise that OFGEM, the UK’s energy regulator, has not issued any statements regarding the alleged breach of fiduciary duty by energy suppliers.

At the ECA, we believe in transparency and ethical conduct in the energy consultancy industry. Therefore, we urge our members and community to seek accurate information and sources to make informed decisions when assessing any claims or allegations.

We want to make it unequivocally clear to our community that we will not shrink in the face of unfounded accusations or misleading statements; rather, we take a bold and assertive position against inaccurate or unfair reporting in all forms.

Our Values

We believe in providing timely and transparent insights on all relevant news, whether positive or negative, empowering our community and enhancing the industry’s reputation, further highlighting our unwavering commitment to promoting best practices that benefit our members and their customers.

As a responsible trade body, we uphold the values of transparency and ethical conduct in the energy brokering industry and will continue to uphold these values and ensure that our industry is held to the highest standards of professionalism and integrity.

Register Your Interest

Holding a series of workshops, we can explain in more detail the benefits of joining, our priorities along with updating our peers, on the work we have already started with various external stakeholders.

Register your interest and help forge a community that is dedicated to promoting and protecting our industry’s interests.

Register your interest here.

A strong, unified, and well-represented trade body will help shape our industry’s future, ensuring the security and ability for us to operate and provide service is maintained and preserved – while also focusing on better end-customer outcomes.

Without the Energy Consultants Association – we are all simply passengers with our fate in the hands of Ofgem and the Government.

UPDATE: The Response From The Times

We are pleased to share an update on our recent response to The Times article.

The publication has provided a response to our concerns and has agreed to amend some of the language in their online article. We are grateful for their timely response and willingness to take our feedback into account.

Specifically, they have acknowledged that the language used in the article regarding the alleged breach of fiduciary duty by energy suppliers could be confusing and have agreed to clarify it.

Dear ECA Team

Thanks for getting in touch.

Regarding your first point, the article said: “RGL estimates that seven in ten British businesses could be eligible to claim and says that more than 4,000 companies have expressed a wish to join the action. According to its analysis [my emphasis], £60,000 could be claimed per company, on average.” The article was clearly reporting RGL’s assessment, rather than making an assertion of fact.

Regarding your second point, we said that Ofgem had highlighted this practice, which it had. The following sentence does not refer to Ofgem and there was no intention to attribute the position on fiduciary duty to them. That said, we see your point that the paragraph could be confusing. We will amend that line in the online article to read “Because the commissions were hidden in energy contracts, they were said by RGL [my emphasis] to be a breach of the fiduciary duty to the customer.”

Regarding your last point, RGL has assured us it is an FCA-regulated entity: but we will take your wider point on board. I’ve made our reporter aware of your letter and we will bear what you say in mind when planning future coverage.

Best wishes

The Times

As a trade body that represents and protects the interests of energy consultants and intermediaries, we take our responsibility to ensure accurate and fair reporting in the industry seriously. We are proud to continue our one voice approach in standing up against misleading and inaccurate reporting about our industry.

We will continue to advocate for transparency and ethical conduct in the energy consultants industry, and we encourage our members and the wider community to seek accurate information and sources to make informed decisions.

10 Comments

  1. Shohrub Hossen April 19, 2023 at 5:31 pm - Reply

    Thank you ECA for your response against the bogus, imaginary and misleading Article of the Times. The content of the Article has no basis with reality.

    • ECA April 19, 2023 at 5:50 pm - Reply

      Thanks for reading and supporting Shorub, your comment is appreciated.

  2. Louis Fairfax April 20, 2023 at 10:47 am - Reply

    Well done on making a point of responding on this.

    • ECA April 20, 2023 at 11:01 am - Reply

      Thanks for your support Louis.

  3. David Baker April 20, 2023 at 10:49 am - Reply

    Thank you for your support in addressing the inaccurate article in the Times. It is good to have an organisation which speaks out for the majority of honest energy brokers who work in the best interest of its clients when dealing with energy contracts and energy suppliers.

    • ECA April 20, 2023 at 11:02 am - Reply

      We appreciate your feedback David and wholeheartedly agree.

  4. Hassan April 27, 2023 at 2:53 pm - Reply

    Well done. It is about time the brokers should have a common voice.

    • ECA May 4, 2023 at 3:08 pm - Reply

      Thank you for your support Hassan!

  5. Nick Grogan May 3, 2023 at 8:33 am - Reply

    Great to see someone standing up for brokers, too many lies are being printed at the moment.

    • ECA May 4, 2023 at 3:09 pm - Reply

      Thanks Nick, we will always endeavour to call out misleading reporting regarding our industry.

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