Ofwat tells wholesalers to agree common retailer satisfaction measure by October

Ofwat has told wholesalers to agree to adopt a common measure of retailer satisfaction by the end of October 2019, with a view to implementing it and first publishing data by April 2020. If they fail to do so, it will consider proposing a code modification to formally implement a consistent measure.

This was one of a series of priorities Ofwat set out in the Outcomes report it published last week, following up on its November 2018 Call for inputs,focussed on strengthening wholesaler service and performance in the retail market. Alongside the priorities, Ofwat published milestones by when it expects progress to be made.

The regulator said it would monitor the impact and effectiveness of the common satisfaction measure once implemented, with a view to potentially adding financial incentives. It said: “We note that residential customer (C- MeX) and developer (D-MeX) measures of satisfaction will include financial incentives for under and out performance from April 2020. It may be appropriate for the measure to include financial incentives over time.” Ofwat confirmed it is not planning to implement a scheme focussed on improving wholesaler service as part of PR19.

Elsewhere, Ofwat said it wanted to see 2019 Operating Performance Standards (OPS) data published by July; would monitor the uptake of Retailer Wholesaler Group guidance from August; wants proposals for Market Performance Standard and OPS charge redistribution by October; and a multi-year plan for the Market Performance Framework by December.

The regulator noted: “We believe that industry has the tools and processes necessary to address market frictions arising from wholesaler performance. But it’s essential that much faster progress is now made.”