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State should run power firm spam database, says... competition watchdog

Happy with your deal? You won't be after this

The UK’s competition regulator wants to see a new database of utility customers set up so they can be bombarded with “targeted marketing”.

The Competition and Markets Authority wants the personal data of energy customers who fail to switch from the default tariff for three years – what the CMA calls “Disengaged Domestic Customers” – made accessible to commercial rivals.

The idea is that competitors can induce them to switch.

“It’s not spam, it’s targeted marketing”, Roger Witcomb, chairman of the CMA's energy market investigation insisted on BBC Radio today.

Whitcomb also claimed that the proposal would be compliant with European personal data regulations, after informal chats with the Information Commissioner' Office.

The plans were originally revealed by the FT last week but officially confirmed today in a shakeup of the highly regulated UK energy market. The CMA wants Ofgem to set up and maintain a “database of ‘disengaged customers’”.

The purpose would be to “prompt [Disengaged Domestic Customers] to engage in the markets.”

Would the database be opt in or opt out? Here the report is contradictory, clearly stating that it would be both at once. Here is the opt-in recommendation:

In order to enable suppliers to prompt domestic customers of rival suppliers on default tariffs, our proposed remedy would require energy suppliers to disclose certain details of their domestic customers (on any meter type) who have been on their standard variable tariff (or any other default tariff) for three or more years (the "Disengaged Domestic Customers") to Ofgem, and would recommend that Ofgem retain, use, and disclose this data (via a centrally managed database) to rival suppliers. The Disengaged Domestic Customers would have the option to opt out of the disclosure process at any point in time. [107]

And here is the opt-out wording, which muddies the waters:

...such data will only be available if customers actively choose to make it available (except in relation to communication with customers on the default tariff database… customers will still have the right to opt out beforehand, and will only be contacted by post unless the customer agrees otherwise”. [emphasis added]

It’s less of a “nudge” than a sledgehammer. You can download the full CMA provisional decision on remedies here: (pdf) ®

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