More than half of households won't switch in a competitive water market says report

More than half of household customers will probably not engage with a competitive market in household water retail according to a report by PwC on behalf of CC Water.

The consultant pointed to the 50% switching rate in energy and said: "Experience in other sectors suggests that we might expect larger numbers and proportions of the customer base to be disengaged." It predicted that sophisticated customers will take up better tariffs while less aware groups remain on existing and poor value tariffs.

The report said a household retail market in water and wastewater could learn from some of the actions taken in other sectors to help protect customers' interests. It identified six key requirements for a successful household retail market in water. They were:

  • Price competition among retailers with no dominant position held by any retailers in the market;

  • customers receive value for money in the services they receive by retailers;

  • customers are active and engaged in the market, with an easy, smooth process for switching supplier and no groups of customers excluded or deterred from engaging with the market;

  • retailers motivated to deliver improved services;

  • new suppliers can enter the market freely; and

  • customers who need extra protection receive it.