A new report is calling on the Government to reform the energy market to make it easier for small businesses to switch providers and access cheaper tariffs.
Open Energy, commissioned by the Federation of Small Businesses (FSB) and produced by Fingleton Associates, highlights how data can be used by customers - and those that represent them - to help make more informed decisions about their energy service.
The Open Energy concept would bring a number of reforms to the market, including:
- Standardising tariffs and other market information in machine-readable formats to allow automated comparisons of energy tariff offerings;
- Making smart meter data available through a secure standardised API to approved third parties;
- Allowing energy customers to delegate contract switching powers to third party intermediaries.
The report concludes that these reforms would increase switching rates and create opportunities for innovative uses of data, including for demand-management purposes that could increase the proportion of the total energy mix from renewables.
Mike Cherry, FSB national chairman, said: "Small businesses are often the worst hit by an energy market that simply doesn't work for them. Too often we hear stories of smaller firms being overcharged or being stuck on the most expensive tariffs.
"This is why we need an open and transparent energy market that allows smaller businesses to take control of their data and use it - via an intermediary if they choose - to find the best energy deal, switch providers, take advantage of smart technology, manage when and how they use their energy, and even how it is generated.
"Open Energy, like Open Banking, has the potential to transform the market - if implemented correctly. It would help small businesses to be more energy efficient and empower them to make energy choices that are cleaner, greener and more sustainable."
John Fingleton, ceo of Fingleton Associates, said: "It is very clear that households and small businesses buying energy in the UK find the market somewhat confusing and are not always able to switch with confidence. It is also clear that switching can bring huge benefits in terms of lower price and better service … Open Energy would help address this fundamental problem that underlies competition concerns in the energy sector. It would enable customers to switch optimally with minimal effort, lowering their bills and increasing productivity in the sector."