The energy regulator, Ofgem, publishes data on the consumption of gas and electricity by typical domestic consumers in GB. These Typical Domestic Consumption Values become industry standards and are used in a variety of different ways by energy suppliers, Price Comparison Websites, and the media. They have also become the benchmark annual consumption value used by Ofgem when it sets the prepayment and default tariff price caps.
The Typical Domestic Consumption Values are based on the total domestic consumption of gas and electricity in GB over a 2-year period and are subject to biennial review.
Having last been reviewed in 2017, Ofgem published its latest review of the Typical Domestic Consumption Values in an open letter to the energy industry and its stakeholders on 18 October 2019. In our response to this consultation, CAS observes that:
- The value of the Typical Domestic Consumption Values to both consumers and suppliers is eroded by the use of GB averages. These hide very significant variations in typical annual domestic gas and electricity consumption between the different regions of GB. The Typical Domestic Consumption Values could therefore be made more relevant were they to be reported as a series of averages by electricity distribution network operator region. This would be consistent with how gas and electricity tariffs are priced in GB.
- For properties with wet electric heating systems and/or supplied via multiple electricity meter points, the aggregation of all multi-rate electricity meter types results in a series of Typical Domestic Consumption Values that significantly misrepresents consumers’ total annual consumption and their peak:off-peak consumption split. With the possibility that the revised Typical Domestic Consumption Values will be integrated into the prepayment and default tariff price caps at a later date, there is a need for a discreet set of Typical Domestic Consumption Values and peak:off-peak consumption splits to be produced for a small number of related multi-rate electricity meter sub-profiles.
- In addition to providing a more balanced and more locally representative price cap, these changes would also allow suppliers to provide consumers with better quality information on how their energy use compares with similar consumers, and better quality, more relevant advice on energy efficiency.