npower announces simpler tariffs and end of complex two-tier rate

npower announces simpler tariffs and end of complex two-tier rate……….

npower has announced it is to simplify all its standard tariffs, bringing to
an end the current complex two-tier tariff structure. From 1st May 2013,
npower tariffs will have a single rate for each unit of energy used.
Customers will also pay a fixed standing charge to cover the cost of
bringing gas and electricity to their door.

Ofgem, the energy industry regulator, will be bringing new Licence
Conditions into force later in the year which will mean that all energy
suppliers’ tariffs will have a standing charge.

Paul Massara, Group CEO, RWE npower said: “At the end of January I set out
our goal to focus squarely on customers and to make the company number one
in the industry for customer experience by 2015. We are responding to
customers who want clear and simple energy tariffs. This announcement is the
first step on the journey. We will write to our customers explaining the
changes and what it means to them. Having a consistent format across all
energy suppliers will help customers make the choice that is right for them.

“Getting it right for our customers is the driving force behind all that we
do, now and in the future.”

Some of npower’s gas tariffs have seasonally weighted elements. This feature
will disappear when the standing charge is introduced and npower will credit
customer accounts if necessary to ensure a fair changeover. This approach
has been endorsed by Consumer Focus and Ofgem has been informed.

This new structure overall reflects more closely the costs of delivering gas
and electricity to customers’ homes. This will mean that some lower users
will end up paying a little more but the company is confident that the
structure is simpler and fairer than the old npower tariffs.

The introduction of a simple standing charge is the first step in a journey
which later this year will see npower reduce the number of its standard
tariffs and replace them with a small number of simple tariffs that meet the
new regulatory guidelines. It will be among the first of the major energy
suppliers to introduce simpler tariffs for all customers on standard
tariffs.

For the moment customers can stay on their existing, non-standard tariff.
However the latest information suggests that new regulations will require
all energy tariffs to comply with the new format during the first part of
2014.