cer sme gas market survey results 2016 - cru ireland€¦ · 2 background survey conducted during...
TRANSCRIPT
CER SME Gas Market
Survey Results 2016
Prepared for:
Prepared by:
May 2016
&
2
Background
● Survey conducted during April/May 2016
Total of 250 interviews completed
● Survey data collection methodology was Computer Assisted Telephone Interviewing (CATI)
Survey length of approximately 25 minutes
● Respondents were decision makers for gas supply related issues within the organisation
Included both private sector and public sector, government organisations and sole traders
● The final respondent set comprises a broadly representative of the SME sector for organisations who use natural gas in their premises with fewer than 250 employees in Ireland.
3
What to look out for in this presentation
● Low engagement with product.
● Strong perception of service
● Evidence of migration to electronic channels for bill receipt
● Significant improvement on price sentiment
● Decline in awareness of competitor and satisfaction with competition
● Contact activity by suppliers for new customer is high as is awareness of market offers
● Reported increase in non-switching, marginal increase in switching but definite increase in changing package from existing supplier
● Ease of comparison of offers is very low
● Switching process is not a barrier
● Relative limited level of bill understanding reported
● Evidence of openness to information sharing through smart meters
● Low arrears reported
4
Respondent profile(Base: All Gas SMEs - 250)
● Various business sizes exist within the SME gas market.
● Gas has seen an increase in representation from the accommodation and food service activities compared with 2015.
Number of employees
0-5 6-50 51-99 100-250
9%
66%
12% 13%
26%
55%
8% 9%
21%
58%
12%
9%
21%
58%
12%
9%
2013
2014
2015
2016
2014 2015 2016
Dublin 53% 51% 53%
Other major city 15% 17% 15%
Other city 3% 4% 3%
Major town/town 23% 22% 23%
Village 2% 4% 2%
Rural (outside village) 4% 1% 4%
Business location
NACE 2013 2014 2015 2016
Agriculture, forestry and fishing 2% - - 5%
Industry Mining and quarrying Manufacturing
5% 6% - -
Construction 6% 3% 4% 4%
Wholesale and retail trade; repair of motor vehicles and motorcycles
14% 11% 16% 12%
Business and Professional Services
14% 25% 19% 15%
Public administration and defence; social security, Education Human health and social work activities
16% 20% 18% 15%
Other Transportation and storage 2% 2% 2% 2%
Accommodation and food service activities Leisure hotels Arts, entertainment and recreation
13% 19% 13% 18%
Other service activities 24% 6% 19% 21%
Activities of extraterritorial organisations and bodies
5% - 1% -
Charity - 8% 8% 7%
5
Respondent profile(Base: All Gas SMEs - 250)
● Respondents sought for survey were those responsible for gas supply related issues – responsibility is dispersed across many different roles within SME organisations
As in 2015 highest role proportion in this wave is the Managing Director/Owner.
17% 17%
8%
4%
13%15%
10%
16%
11%
18%
11%9%
18%
10%
12%
10%
16%
11% 12%
4%
25%
9%
12%
17%
6%
16%
9%8%
22%
8%
10%
20%
Accounta
nt
Fin
ancia
l m
anager/
directo
r
Opera
tions m
anager
Main
tenance m
anager
Managin
g
directo
r/dir
ecto
r/ow
ner
Offic
e M
anager
Adm
inis
trato
r
Oth
er
2013 2014 2015 2016
Role of Respondent
RespondentOther/ shared Nobody
2016 2015 2014 2016 2015 2014 2016 2015 2014
Paying the bill 67% 72% 78% 34% 31% 23% - - -
Monitoring the level of usage
85% 84% 86% 14% 13% 8% 6% 7% 7%
Reducing the size of the bill
87% 91% 88% 13% 10% 12% 4% 3% 3%
Deciding on the tariff that suits your organisation
82% 86% 80% 21% 19% 20% 3% 2% 5%
Making changes to your account
89% 89% 86% 15% 18% 17% 1% 0% 2%
Billing details, payment methods etc
77% 81% 78% 26% 22% 24% 0% 2% 1%
Deciding on which energy supplier will be used
88% 87% 86% 23% 22% 22% 0% 2% 1%
6
Expenditure on gas(Base: All Gas SMEs - 250)
Annual expenditure on gas (€)
● Average expenditure on gas as a percentage of non-wage costs was 5.6% (2015: 5.9% & 6.3% in 2014)
50% of respondents provided an answer to this question reflecting a combination of sensitivity and knowledge
● Average annual expenditure was €31,408 (2015: €47,877 & 2014: €49,956)
82% of respondents provided an answer to this question
● Awareness of cost per unit and standing charges is low, with just 17% of SMEs attempting to answer the cost per unit (24% in 2015) question and 18% answering the cost of standing charge question (27% in 2015)
Expenditure on gas (% of non-wage costs)
1%-5% 6%-9% 10%-14% >14%
57%
18%
8%
16%
70%
7%
12%10%
71%
7%12% 10%
75%
4%
13%8%
2013
2014
2015
2016
<1,500 <2,500 <5,000 <10,000 10,000+
22%
8%
23%
14%
31%
17%
12%
19%21%
32%
15%
10%
23%
17%
36%
20%
8%
13%
20%
39%2013
2014
2015
2016
Excluding don’t knows Excluding don’t knows
7
Energy management: Cost and Usage Reviews(Base: All Gas SMEs - 250)
● Businesses continue to mainly review both cost and usage annually.
● The incidence of SMEs who claim to never review their gas usage has declined -5% pts vs 2015 levels, while those who review usage on a monthly basis has increased by +7% pts.
Frequency of gas cost and usage reviews
Cost Usage
2013 2014 2015 2016 2013 2014 2015 2016
Annually 68% 57% 63% 63% 63% 37% 39% 40%
Every three months 10% 4% 6% 7% 10% 8% 8% 7%
Every two months 5% 8% 6% 3% 5% 7% 5% 6%
Monthly 6% 8% 5% 8% 6% 15% 11% 18%
Don't know 4% 1% 1% 2% 5% 3% 1% 2%
Never 8% 11% 5% 6% 10% 19% 18% 12%
Other (at irregular intervals)
10% 14% 11% 12% 18% 13%
8
Market share: SME gas suppliers(Base: All Gas SMEs - 250)
● With regards to market share BGE claims an additional 4% of the market vs 2015 levels. Energia’s share has grown most significantly however, +13% pts vs 2015. Flogas & Airtricity has seen a decline in their share of the market.
● Satisfaction with service by Supplier has improved +12% pts, with 87% satisfied vs. 75% satisfied in 2015.
Market Share 2016 Satisfaction with service by Supplier
8
0% 3%
9%
43%
44%(41%)
(1%)
(22%)
(34%)
(1%)
7%
43%
5%
21%
30%
3%
(17%)
(39%)
(9%)
(25%)
(8%)(1%)
(2%)
( ) = 2015 data ( ) = 2015 data
Electric Ireland
BGE
SSE Airtricity
Flogas
Energia
Vayu
Very satisfied
Satisfied
Neither satisfied nor dissatisfied
Dissatisfied
Very dissatisfied
9
Satisfaction with SME gas suppliers(Base: All Gas SMEs - 250)
● Satisfaction with suppliers has improved across the board, with Bord Gais and Electric Ireland customers registering most improvement.
Bord Gais SSE Airtricity FloGas Electric Ireland* Energia*
84%
100%
82% 80%75%
73%77%
94%
85%
69%
80%75%
76%
87%84%
89%86%
90%91%
2013 2014 2015 2016
Satisfaction with service by Supplier
9
* Small sample size
Base: (102) (17)* (38)* (21)* (47)*
10
Bill Delivery and Frequency(Base: All Gas SMEs - 250)
● The majority of SMEs continue to receive their bill by post, however the incidence of bills being sent via online methods is increasing.
Little variation in frequency of bill delivery this wave.
Bord Gais SSE
Airtricity
FloGas Electric
Ireland*
Energia*
84%
43%
85%
58% 58%
20%
44%
10%
31%38%
4%
13%7% 15%
19%
Post Email Website
Bill delivery channel
2013 2014 2015 2016
85% 82% 85%
74%
12%19% 18%
25%
3%6% 7% 9%
Post Email Website
Bill delivery channel – by Supplier
Bill Frequency 2013 2014 2015 2016
Monthly 69% 47% 54% 57%
Two Monthly 28% 50% 41% 39%
Quarterly 3% 1% 3% 3%
Other 0% 3% 2% 1%
11
Awareness of when current gas supply contract expires(Base: All SMEs – 250)
54%
46%
Do you know the month & year when yourorganisation’s current contract with your
supplier is up?
Yes No
● Half of SMEs do not know the month and year when their current gas contract is due to expire.
● Amongst those who are aware of when their current electricity contract will expire, Energia, Flogas & Electric Ireland customers show the highest awareness.
* Caution: Small base
No
Yes
Energia SSE
Airtricity
Bord Gais
Energy
Electric
Ireland
Flogas
70%
50%
39%
67% 68%
% Yes x Supplier
Question added 2016
12
Bord Gais Airtricity* FloGas Electric
Ireland*
Energia*
5% 6% 6% 4%
17%
48%
29%37%
46%
49%
36%
53% 43% 31%
32%
11% 12% 14%19%
2%
Don’t know Same Decreased Increased
Perceptions of price change over time(Base: All Gas SMEs - 250)
● There has been a noticeable decline in the level of SMEs reporting an increase in the price charged by their supplier in the past 12 months, with costs appearing to have stabilised.
● Electric Ireland customers are more likely to report an increase in gas prices.
2014 2015 2016
12% 14%8%
30%
39%44%
10%
25%38%
48%
23%10%
Don’t know Same Decreased Increased
Has the price charged by your supplier changed in the last year? 2016
13
Agree with statement
2013 2014 2015 2016
The cost of gas is a significant business challenge for my business
57% 50% 46% 46%
The cost of gas puts my business at a competitive disadvantage to businesses based in other EU countries.
33% 21% 28% 26%
Impact of gas cost on business and competition(Base: All Gas SMEs - 250)
● Despite 2 in 5 SMEs claiming that the price of gas has declined, those claiming that the cost of gas is a significant business challenge has remained level with 2015 findings. About one quarter feel that gas prices are a disadvantage on EU competitive activity.
14
Payment Record and Arrears(Base: All Gas SMEs - 250)
Stated bill payment record by SupplierStated bill payment record
● Almost all SMEs (95%) claim to pay on time and in full, similar to 2015 levels.
● This continued high rate may reflect a ‘broad’ interpretation of what constitutes arrears and perhaps some reluctance to disclose such sensitive information
2012 2013 2014 2015 2016
98% 99% 94% 97% 95%
2% 1%3% 2%
4%0% 0%2% 0% 1%
Currently in arrears
Sometimes in arrears, but not currently
Paid on time/in full
BordGais
SSE Airtricity*
FloGas Electric Ireland*
Energia*
Paid on time and in full
97% 94% 93% 90% 94%
Sometimes in arrears, but not currently
2% - 7% - 6%
Currently in arrears
1% 6% - - -
Refused - - - 10% -
15
Disconnection(Base: All Gas SMEs - 250)
● The level of disconnection (apart from maintenance and power outages) remains low at 2% (0% in 2015).
2%
98%
Business disconnected in the last year?
Yes No
(100%)
(0%)
( ) = 2015 data
16
Awareness of competitors
● Unprompted awareness reflects top of mind presence in the consumer mind.
● Bord Gais continues to receive highest unprompted awareness at 85%.
● Awareness of SSE Airtricity has continued to fall, as has awareness of Electric Ireland.
● Awareness of Flogas, Energia and Vayu remains on par with 2015 levels.
16
Unprompted awareness of Natural Gas Suppliers
85%
54%
39%
34% 35%
5%
87%
48%
37%
46% 45%
6%
85%
47%40%
49%47%
4%
85%
38% 37%
49%41%
7%
Bord Gais SSE Airtricity Flogas Energia Electric Ireland Vayu
2013
2014
2015
2016
(Base: All Gas SMEs - 250)
17
Awareness of supplier vs Gas Networks Ireland responsibility(Base: All Gas SMEs - 250)
Who has responsibility?
Supplier GNI Other Don’t Know
Maintenance of the network 7% 88% 1% 4%
Repairing gas leaks 4% 91% 2% 3%
Billing and payment 84% 15% 0% 1%
Reading the meter 59% 33% 4% 3%
Transmission and distribution of gas 16% 79% 1% 4%
Seeking approval of prices from the regulator
60% 28% 2% 10%
Seeking approval of terms and conditions from the regulator
61% 26% 2% 11%
● In general, there is good clarity of the relative responsibilities of GNI compared with that of Suppliers
18
Satisfaction with aspects of competition(Base: All Gas SMEs - 250)
● SME’s report higher satisfaction levels with their own supplier vs competitors across all aspects of competition.
● Satisfaction has declined with the number and clarity of options.
The number of offers/discounts available
The clarity of offers/Discounts available
The value for money of offers/discounts
Satisfied Dissatisfied
25%
14%
27%
17%
30%
16%
30%
31%
46%
48%
31%
38%
Own supplier
Other supplier
Own supplier
Other supplier
Own supplier
Other supplier
19
Awareness of gas offers (Base: All Gas SMEs - 250)
90%
81%
47%
44%
36%
28%
23%
ANY AWARE
Offers where the unit price of
gas is fixed for a certain time,
usually 12 or 24 months
Offers based on a certain %
reduction on the unit rate of gas
Offers based on receiving
Cashback or credit to your
account after you change…
Offers based on a % reduction
on your entire bill
Offers based on your
membership of the suppliers
rewards or loyalty scheme
Offers based on a % reduction
on the standing charge
● 9 in 10 SME gas customers are aware of at least one gas offer type which is currently on the market.
Larger (51+ employees) companies report the highest level of awareness at 92% while companies with 0-5 employees report the lowest level of awareness at 86%.
No comparable data
% aware x business size 0-5 6-50 51+
ANY AWARE 86 90 92
Offers where the unit price of gas is fixed for a certain time, usually 12 or 24 months
79 80 88
Offers based on a certain % reduction on the unit rate of gas
48 46 48
Offers based on receiving Cashback or credit to your account after you change supplier
55 43 37
Offers based on a % reduction on your entire bill
36 33 46
Offers based on your membership of the suppliers rewards or loyalty scheme
32 27 25
Offers based on a % reduction on the standing charge
27 20 26
20
20
Incidence of SMEs approached by suppliers with
tailored offers
26%
74%
Yes, approached by supplier
No, not approached by supplier
Specifically tailored offered(Base: All Gas SME – 250)
● One quarter of gas SMEs have been approached by competitors offering tailored offers.
● The most common type of tailored offer is lower unit rate.
Type of tailored offer from suppliers
(Base: All approached by a competitor 67)
21
14
12
11
8
4
4
4
2
15
29
Lower unit rate
Bundle/multiple product offers
Lower rate than competitors/current bill
Set rate/fixed prices for the year
Reduced charges/percentage discount (general)
Low rates at night time
Reduced tariffs
Prices based on consumption
Better terms for initial/start up period
Other
Can't remember
%
(72%)
(28%)
( ) = 2015 data
21
Awareness that prices are not regulated(Base: All Gas SMEs - 250)
● Market knowledge appears to be gradually improving, with 2 in 5 SMEs now aware that prices are no longer regulated.
Electric Ireland customers reported the lowest level of awareness.
Aware of non regulation of price
2013 2014 2015 2016
Aware 36% 24% 34% 39%
Somewhat Aware
6% 15% 14% 10%
Not Aware 58% 61% 52% 52%Bord Gais SSE
Airtricity
FloGas Electric
Ireland
Energia
37%44%
36%
19%
44%
10%
20%
10%
4%
10%
53%
36%
54%
76%
46%
Aware Somewhat Aware Not Aware
Aware of non regulation of price, by Supplier
Q: Are you aware gas prices charged by suppliers are not regulated which means that suppliers can set their prices at whatever level they choose?
22
Contact by Suppliers(Base: All Gas SMEs - 250)
● Competitor activity appears to be increasing as half of SMEs now recall some form of contact from competitors with a view to switching.
● Phone and mail contact have increased on 2015 levels, while business visiting remains steady.
SSE Airtricity continues to appear to be the most proactive, albeit BGE has registered the greatest increase.
Contact Channel
2013 2014 2015 2016
Phone28% 26% 26% 33%
Mail 6% 9% 8% 14%
Business visit 11% 23% 27% 26%
2013 2014 2015 2016
Bord Gais 29% 27% 34% 53%
SSE Airtricity 61% 50% 65% 57%
Flogas 42% 50% 58% 49%
Energia 30% 61% 55% 44%
Electric Ireland
34% 50% 52%
Contact by Supplier
(41%)
2013 2014 2015 2016
65%59%
52% 49%
35%41%
48% 51%
No Yes
Contact by other supplier with a view to switching in the past 12 months
23
Awareness and understanding of offers available(Base: All Gas SMEs - 250)
● The proportion of respondents indicating that they are not aware of different offers available has declined on 2015 levels as respondent awareness of offers now spans from small understanding to mostly/fully understanding.
Energia customers claim to have the most understanding of offers.
Level of understanding of offers
2013 2014 2015 2016
Not aware of the offers available
20% 37% 46% 22%
No/Small Understanding 25% 13% 11% 17%
Some understanding 18% 16% 17% 27%
Mostly/Fully understand 37% 34% 26% 33%
Understanding of offers by supplier
Q: Thinking about the different offers available from gas suppliers, please rate your understanding of the offers available.?
Bord Gais
SSE
Airtricity FloGas
Electric
Ireland Energia
19%31% 31%
20% 20%
19%
42%
18%
14%5%
23%
13%
27%
23% 37%
38%
15%26%
43% 36%
Not aware No/small understanding
Some understanding Mostly/full understanding
24
24
Ease of comparison of other offers
13%
16%
17%
14%
10%
31%
Ease of comparing offers available(Base: All Gas SMEs - 250)
● Similarly to 2015 one third of SMEs claim not to have compared offers confirming the low level of market understanding.
● The ease of comparing offers has remained unchanged since 2014.
Ease of comparison of other offers
(12%)
(11%)
(15%)
(15%)
(9%)
(38%)
( ) = 2015 figures
30%
24% 24% 24%
2013 2014 2015 2016
Ease of comparing offers x business size
0-5 14%
6-50 28%
51+ 22%Very difficult
Difficult
Neither easy nor difficult
Easy
Very easy
Not compared offers
25
25
Gas Switching experience – level of switching(Base: All Gas SMEs - 250)
● The incidence of ever switching gas suppliers has returned to 2015 levels, while the reported rate of switching within the past 12 months is broadly similar to 2015 levels. (2013: 16%, 2014: 23%, 2015: 23%).
● Bord Gais Energy SME respondents continue to be the least likely to have ever switched supplier, although the level of non-switching has declined from 71% in 2014 to 56% in 2016.
● Among all who had switched in the past 12 months, 41% switched back to a previous supplier (16% of all who ever switched).
2013 2014 2015 2016
16%
23% 23% 26%
2013 2014 2015 2016
15%27% 29% 33%
16%
19% 19% 15%23%
18%24% 18%
46%36%
28% 34%
More than twice Twice Once Never
Have you switched gas suppliers in the last 12 months?How many times have you ever switched gas suppliers?
28
Gas - Switching Package/option with existing supplier
● Among all non switchers, 67% reported changing package with their current supplier.
● The majority of non-switchers remained on their original package, with the main reason being that they were satisfied with their current service/package.
33%67%
For Non switchers - Changed the package with existing supplier – e.g. for a better discount
(Base: Did not switch last 12 months – 186)
Yes
No( ) = 2015 figures
(17%)
(83%)
Why didn’t switch - 129
33
15
12
10
7
7
4
6
3
Satisfied with current service/package
Haven't been approached/offered
anything
Time consuming/too much hassle
Didn't know I could change
Little benefit to changing/not worth it
Contracted into current package
Current costs reasonable
Not my/our decision
Didn't want to use direct debit
%
29
Gas – Switching consideration(Base: All never/not switched gas in last 12 months - 186)
Switching consideration: Suppliers considered:
Considered switching to: (All considered switching – 62)
Electric Ireland 38%
Bord Gais Energy 40%
SSE Airtricity 42%
Flogas 29%
Energia 51%
Vayu 6%
GazProm 5%
Considered switching Contacted alternative supplier
16%
35%38%
47%
41%46%
33%37%
2013
2014
2015
2016
● Among non switchers, there has been a decline in the incidence of switching consideration and also contacting competitors for providers.
● Energia achieved the highest level of consideration.
30
Reaction once your contract ends
Reaction when your contract ends (Base: All SMEs 250)
52
14
12
12
4
3
3
Look around to see if there are better offers available from
other suppliers
Look at any options/offers my supplier sends and select thebest for me
Automatically continue on with the supplier irrespective of
what tariff is applied
Contact the supplier to renew/negotiate the tariff/package
you are on
Automatically continue on with the supplier knowing the
default tariff that is charged
Look at any options/offers my supplier sends but just go
with the default tariff that is charged
Switch supplier
%
Q6400 Which of the following best describes how you react once your contract ends with your electricity supplier?
Number of employees
0-5 6-49 50+
53 114 83
% % %
40 56 52
11 14 20
25 8 11
6 14 10
11 4 0
4 3 1
3 2 7
● Half of SMEs claim to look around to see if there are better offers available when their contract ends. While 1 in 7 automatically continue on with the supplier irrespective of tariff and even if they know the tariff.
● Some variation noted across business size as smaller companies are more likely to automatically continue on with their supplier, while larger companies will consider their options.
31
Gas – Reasons for switching, amongst switchersBase: All switched to new supplier in past 12 months (not switch back) - 39
● Among SMEs using natural gas the main reason for switching their gas supplier was to achieve a reduction in their gas bill.
Top 5 reasons
Important
Not Important
2013 2014 2015 2016 2013 2014 2015 2016
To achieve a reduction in the total cost of gas
68% 92% 100% 87% 12% 4% 0% 4%
The previous supplier had recently announced a price rise
40% 51% 55% 54% 44% 35% 40% 25%
My business’ bill increased in size because my previous supplier had increased prices
36% 50% 53% 54% 48% 37% 36% 31%
To avail of a combined offer for electricity and natural gas
24% 38 41% 53% 48% 49% 38% 33%
The new supplier offered a more flexible tariff structure
40% 36% 42% 44% 40% 37% 39% 39%
32
Gas – Reasons for switching, amongst switchersBase: All switched supplier in past 12 months (not switch back) - 39
● Customer service is low on the list of reasons for changing gas supplier, albeit the levels have increased.
Other reasons
ImportantNot Important
2013 2014 2015 2016 2013 2014 2015 2016
The new supplier offered greater assistance on energy reduction initiatives
37% 37% 27% 30% 48% 46% 48% 47%
My business was not satisfied with the service provided by our former supplier
24% 27% 14% 27% 52% 65% 62% 56%
I was unhappy with the service I have received from my former supplier
24% 20% 9% 26% 48% 69% 63% 59%
To get more information on electricity usage
16% 15% 18% 20% 56% 59% 59% 48%
I preferred the online billing option from my new supplier
28% 14% 17% 15% 48% 69% 65% 56%
I expected the customer service from the new supplier would be better
20% 34% 21% 14% 52% 51% 49% 49%
33
Gas – Reasons for switching back to old supplier, amongst switchersBase: All switched back to previous supplier - 25
Top 6 reasons: ImportantNot
Important
To achieve a reduction in the total cost of gas 89% 3%
The business expected to get more savings by returning to my original supplier
74% 8%
The new supplier had recently announced a price rise 51% 31%
To avail of a combined offer for electricity and natural gas 50% 38%
My original supplier contacted me with a better offer if I would switch back
43% 49%
My bill increased in size because the business’ new supplier had increased prices
41% 28%
● Top 6 reasons for returning to the original supplier mainly relate to price considerations
35
Understanding of Discount agreement(Base: All switched last 12 months – 64)
Price Guarantee Period
2013 2014 2015 2016
10% 7% 6%8%
0% 0% 0%0%
0%6%
2%
0%0%0%
0%0%
58%
68% 81%
66%
8%
6%
7%
11%3%
2%
0%
2%21%
11%4%
12%
No guarantee 3 months
6 months 9 months
1 year 2 years
< 2 years Don’t know
Q: Are How long does the discount offered when you switched last for?
NO restrictions on future switching?
Period of restriction
2013 2014 2015 2016
6 months 8% 3% 2% 3%
1 year 75% 88% 87% 77%
2+ years 8% 7% 8% 18%
Don’t know 8% 2% 3% 2%
2013 2014 2015 2016
30%
37%33%
23%
36
Incidence of non-switchers being offered or considering competitor offers/discounts(Base: Non switchers: 186)
● 2 in 5 non switchers were offered or considered competitor offers (up from 1 in 3 in 2015).
● There has been an increase in price guarantee lasting for 12 months vs 2015 levels.
38%
62%
Incidence of non-switchers being offered or considering competitor
discounts/offers
Yes
No
Period price guarantees were offered for:(Base: All who were offered/considered competitor offer – 69)
2015 2016
No guarantee 6% 4%
3 months 3% 3%
6 months 13% 9%
1 year 53% 63%
2 years 13% 8%
Don’t know/can’t remember 12% 13%
Question added 2015
(30%)
(70%)
37
Gas – Non Switchers – reasons for not switchingBase: All non switchers - 186
● Satisfaction with current supplier continues to be the main reason for not switching. Disbelief in competitor offers also continues to be high on the reasons for staying with original supplier.
Top 7 reasonsImportant
Not Important
2016 2015 2014 2013 2016
We are satisfied with the service that we receive from our current supplier
67% 53% 58% 56% 11%
We do not believe that the level of discount is sufficient to justify switching
40% 39% 46% 34% 32%
Other priorities have meant that this has not been considered 38% 38% 41% 45% 40%
We do not believe that the prices will stay as low as the alternative suppliers claim
34% 39% 38% 36% 36%
We do not believe that the prices will be as low as the alternative suppliers claim
33% 33% 34% 34% 42%
We are concerned about whether the alternative supplier will provide a reliable supply of gas
30% 22% 25% 33% 54%
We are concerned about whether the alternative supplier will be as responsive if there is a leak
26% 25% 25% 26% 59%
39
Gas – Non Switchers – reasons for not switching(Base: All who have not switched within past 12 months – 186)
Non-Switchers
67%
40%
38%
34%
33%
30%
26%
25%
24%
18%
18%
17%
16%
16%
10%
8%
8%
7%
7%
3%
We are satisfied with the service that we receive from our current supplier
We do not believe that the level of discount is sufficient to justify switching
Other priorities have meant that this has not been considered
We do not believe that the prices will be as low as the alternative suppliers claim
We do not believe that the prices will stay as low as the alternative suppliers claim
We are concerned about whether the alternative supplier will provide a reliable supply of gas
We are concerned about whether the alternative supplier will be as responsive if there is a gasleak
We are concerned that the alternative suppliers may not stay in the gas market for long
We are not able to switch because of the contract with our current supplier
The offers from the other suppliers are too complex
We would be charged a penalty and the saving to be made with a new supplier would not coverthis penalty.
The terms and conditions of the offers were not clear
The prices of the offers are not clear
The terms of the available contracts were too long
Other bills are a priority
We would have had to pay a large deposit
I did not know I could switch
We do not believe that we able to switch because of arrears on the business account
We do not want a new supplier to ask about our current supplier if there were arrears on thebusiness account
It is not possible for my business to switch due to outstanding arrears on our business’ gas account
All who never switched &
never considered switching
(n-66)
All who never
switched but considered switching
(n-18)
Switched over 1 year
ago(n-102)
70 51 68
39 49 40
37 45 37
40 31 31
38 24 31
37 34 25
34 31 20
36 33 17
25 21 24
17 26 18
21 9 17
11 42 18
13 33 16
13 24 16
11 6 11
7 - 11
9 7 9
12 - 5
9 - 7
5 - 2
40
Rating the overall experience of switching
Experience of switching processBase: All switched last 12 months - 64
• The overall rating of the ease of switching has recovered following a dip in 2015.
Just 2 people reported a difficulty with the switching process.
• Of those who switched, no respondents indicated that they were required to pay a deposit
0% 1% 4% 15% 80%
2014: 95%
Rating the overall experience of switching by Supplier40
Very
DifficultVery
Easy
Bord Gais* SSE
Airtricity*
Flogas* Electric
Ireland*
Energia*
0% 0% 0% 0% 0%0%13%
0% 0% 0%0%
0%
0% 0%7%9%
0%
0%0%
5%
33%26%
0%0%
25%
58% 61%
100% 100%
63%
Don’t know Very difficult Difficult Neither Easy Very easy
6% 3% 4% 18% 68%
2015: 86%
2% 2% 4% 20% 72%
2016: 92%
41
41
Rating the overall experience of switching
Impact of switching processBase: All switched and received a bill - 59
• The impact of the switching process is generally as expected for the SMEs who switched.
2013 2014 2015 2016
Agree Disagree Agree Disagree Agree Disagree Agree Disagree
My business’ bill was reduced by the amount I expected
71% 9% 62% 5% 73% 8% 77% 7%
The service from my new supplier was satisfactory
80% 3% 85% 2% 87% 2% 85% 4%
We understood the terms and conditions of the offer the business had signed up for
89% 5% 85% 2% 86% 5% 86% 3%
43
Dual Fuel
• Saving and convenience considerations continue to be the most frequently cited benefits for switching to a single supplier for gas and electricity
Factor in the decision to change to a single supplier for dual fuel
(Base: All dual fuel – 98)
BenefitNot at all a benefit
The greater saving overall 78% 10%
The convenience of having a single supplier for both
74% 16%
The greater reduction in electricity prices offered when your business also used the same supplier for gas
73% 13%
The greater reduction in gas prices offered when you also used the same supplier for electricity
70% 11%
Aspects of the service provided by your supplier -for both electricity and gas
50% 24%
Factor in the decision not to have a single supplier for dual fuel
(Base: All non-dual fuel – 152)
BenefitNot at all a
benefit
Satisfied with the service provided by our current supplier for each and see no reason to switch
66% 11%
The savings are greater if your business uses two different suppliers
44% 36%
Have not got around to switching to a single supplier
25% 52%
Do not want to receive a single bill for both gas and electricity
25% 60%
You do not trust a single supplier to provide both electricity and gas
19% 66%
You are concerned about what would happen if your business fell behind on payments for either
14% 73%
44
Bill Understanding and impact(Base: All gas SMEs 250)
● Energia customers appear to have the most easy to understand bill, while Electric Ireland’s bill appears to be the most difficult for customers to understand across the measures.
● Only half of SMEs feel the bill makes it easy for them to understand the tariff they are on.
73
73
72
70
54
64
70
65
66
Bill makes it easy to understand the gasused
Makes it easy to understand the gas chargedfor
Understand the calculation of the bill
Bill is easy to understand
Bill makes it easy to understand the tariff Iam on and to identify all of its components
2016 2015 %
Q.11115 Are any of the following elements of the bill unclear to you? SHOW SCREEN
2016 Current Supplier
Bord Gais/
Energy
SSE Airtricity
FlogasElectric Ireland
Energia
% % % % %
73 69 66 55 84
75 70 63 50 85
78 51 63 40 84
72 63 54 49 90
53 39 44 46 70
Overall
n/a
*Question added 2016
Received Bills
By post Online
% %
71 79
73 76
74 69
69 79
54 55
45
Element that is unclear
Elements of the bill which are unclear(Base: All SMEs 250)
● Understanding of particular bill elements do not appear to be causing a significant issue. Unit price per kwh is the most unclear element of the bill (albeit marginally) - higher among Bord Gais Energy Customers.
● SSE Airtricity customers reported that MPRN number and standing charges were the most unclear elements on their bill.
17
16
14
9
Unit price per kilowatt hours (kWh)
Standing charges
Meter reading (KWh used)
MPRN Number
%
Q.11115 Are any of the following elements of the bill unclear to you? SHOW SCREEN
Current Supplier
Bord Gais/
Energy
SSE Airtricity
FlogasElectric Ireland
Energia
102 17 38 21 47
% % % % %
17 19 23 21 11
19 24 21 10 9
19 7 11 30 8
12 12 10 11 5
Received Bills
By post Online
173 92
% %
17 15
17 17
16 12
12 7
46
Smart Metering (Base: All SMEs 250)
Smart Meters are the next generation of energy meter. They will replace the traditional electricity and gas meters removing the need for an office visit to read the meter. This will eliminate the need to use estimates whenever a meter cannot be read.
Smart meters work by communicating with you and your energy provider giving a detailed view of actual energy usage throughout the day and night. This provision of actual consumption information delivers benefits such as;
Providing businesses with a mechanism to reduce their electricity bill by enabling the business to shift some of their electricity usage away from (more expensive) peak consumption times;
Informing businesses of their actual usage in electricity and gas therefore allowing them to avoid unnecessary consumption and cost; and
Helping the environment through reducing overall energy production.
90%84%
100%93% 95% 95%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Overall Bord Gais
Energy
SSE
Airtricity
FloGas Electric
Ireland/ESB
Energia
Q. Would you be willing to share the information collected on the smart meter with your supplier to avail of new tariffs & services?
● SMEs were asked their opinion on smart metering. The following information was read out to respondents before being asked a series of questions:
Openness to share information with suppliers to avail of new tariffs and services
*Caution small base
Smart Metering (Base: All SMEs 250)
Q. Would you continue to use an in-office device to assist in managing your costs?
Q. Would you find this type of information helpful in managing your organisations energy consumption?Base: All who would continue to use in-office device
97% 97% 100% 97% 95% 100%
0%
20%
40%
60%
80%
100%
Overall Bord Gais
Energy
SSE
Airtricity*
FloGas* Electric
Ireland*
Energia*
88% 84%95% 93% 90%
84%
0%
20%
40%
60%
80%
100%
Overall Bord Gais
Energy
SSE
Airtricity
FloGas Electric
Ireland/ESB
Energia
88%
12%
YesNo
Overall
High agreement
48
Bill Frequency(Base: All gas SME – 250)
My business would prefer to receive bills more frequently
57%
13%
15%
5%
9%
Strongly disagree Disagree Neutral
Agree Strongly agree
Business would prefer to receive bills more frequently– by Supplier
Bord Gais SSE
Airtricity*
FloGas Electric
Ireland*
Energia*
17%7%
12% 10%15%
13%
11%
20% 24% 10%
70%
82%
68% 67%75%
Agree Neutral Disagree
( ) = 2015 figures
(15%)
(55%)
(15%)
(6%)
(9%)
Summary & Key Points
51
Summary and Key points (1)
● Knowledge of and sensitivity to gas consumption and cost and t’s &c’s by SME’s remains low
Continued decline in awareness of cost of gas – 17% could hazard a guess on unit cost and 18% on standing charge.
Frequency of review of usage and cost has decreased marginally with greater emphasis on the cost as opposed to usage metrics.
About half of SMEs do not know the month and year when their current gas contract is due to expire.
Nevertheless of those who are aware, 52% claim to look around to see if there are better offers available when their contract ends.
● Perception of service has improved to 87% (+6% higher than electricity) with respondents reporting improved experience across all suppliers.
Range of satisfaction is from 84% to 91%.
Energia is highest at 91% and Bord Gais lowest at 84%.
● There is evidence of migration to electronic channels for bill receipt, with non-post channels increasing for the fourth consecutive year (to 34%). This is being led by SSE Airtricity and Energia.
52
Summary and Key points (2)
● Improved sentiment on price
The increase in satisfaction is almost driven by improved perception of price.
The proportion of respondents who believe the price has increased the past 12 months has gone from 48% to 10% since 2014, and the proportion who believe it has decreased has almost had a four-fold increase.
Nevertheless, the perception that cost of gas is a significant business challenge for businesses remains unchanged, at 46%.
● Apart from Bord Gais, awareness of competitors has declined across all suppliers.
Bord Gais reports highest awareness at 85%, with VAYU at 7%.
Other suppliers awareness range between 37% and 49%.
● Notwithstanding the improved sentiment on price, there are increasing levels of dissatisfaction with aspects of the market related to competition.
46% are dissatisfied clarity of pricing and discounts, with 30% and 31% respectively dissatisfied with number and value for money of the discounts available.
SME’s perceive their current supplier as offering more satisfaction in these areas (25%-30% satisfaction).
39% of SME’s aware that prices are no longer regulated.
53
Summary and Key points (3)
● Market awareness in terms of offers available, and contact activity is high
90% of SME’s claim to be aware of offers available.
At 81%, offer awareness continues to revolve around those with a fixed unit price for 12 or 24 months, followed by a percentage reduction on the gas unit rate (47%).
26% of gas SMEs have been approached by competitors with tailored offers and 51% have been contacted with a view to switching in the past 12 months.
38% of non switchers were offered or considered competitor offers (30% in 2015).
Consistent with competitor activity, a declining number (31%) of respondents claim that they have not compared the different offers.
Although improving, satisfaction with ease of comparison of offers is modest at 24%.
● Competitive market activity has remained steady
With 51% contacted by competitors to encourage switching, the response showed 26% switched in the last 12 months, but 34% report never having switched.
Decrease of 8% pts among those who considered switching to 33% - comparable to the electricity market.
Nevertheless 36% changed package with existing supplier, almost double 2015.
● The switching process enables switching amongst those who engage
Ease of switching process is at 92%.
Expected outcomes in terms of bill reduction, improved service and understanding of t’s & c’s have remained broadly stable at 77%, 85% and 86% respectively.
54
Summary and Key points (4)
● While marginally improved from 2015, aspects of bill understanding are somewhatlow
Bill understanding is at 70%, while understanding of calculation is at 72% while ‘bill makes it easy to understand the tariff and to identify all of its components’ is rather low at 54% .
Specific components of the bill such as Unit price per kWh, standing charges and meter readings are equally identified as the most unclear elements of the bill at 14% to 17%.
Current level of bill frequency is acceptable to the customer base.
● Considerable openness to information sharing through smart meters.
95% (89% for electricity) would be willing to share information collected on the smart meter with supplier.
97% (80% for electricity) would find IHD consumption type information helpful in managing the organisations energy consumption.
● Self reporting of arrears incidence is at 1%.