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Ofgem sets up database so energy companies can spam Brits

Capitalism, free markets, competition, whoop-de-doo

The UK's energy regulator is creating a database service that farms out information on Britons' energy tariffs to rival companies for the sake of ensuring a “competitive market”.

Earlier this year the Competition and Market Authority (CMA) published a mammoth 1,423-page report (PDF) followings its two-year investigation into the energy market in the UK.

The CMA report found that "two thirds of households are disengaged" from the energy market, "and paying over the odds for their energy compared to those who have switched tariff."

As a remedy it recommended that the Office of Gas and Electricity Markets (Ofgem) develop a database of customers for the explicit purpose of allowing "rival suppliers" to nag each others' customers, if those customers have been on the default tariff for three years or more.

From whence would this database service be populated? Responding to the CMA's initial paper, the Information Commissioner's Office suggested (PDF) the service could be operated on top of the Electricity Central Online Enquiry Service (ECOES) database, which contains all Meter Point Administration Numbers (MPANs) in the UK.

MPANs are 21-digit reference codes which uniquely identify electricity supply points in the UK, most often a particular property. Any data linked to the MPAN of a domestic property, according to the ICO, "is likely to be personal data, even if the name of the individual (or individuals) who live there is not known" and as such will be protected by the Data Protection Act 1998.

One of the ideas floated was that price comparison websites could be given access to the ECOES database for the sake of facilitating customers switching between energy suppliers. This would only be justified if that access was given "as the result of a direct request from an individual" for the third-party to facilitate switching to another supplier.

Ofgem informed The Register that it was still figuring out how to implement the CMA's remedies, but thinks that its database service will go live across the natio in spring 2018. A spokesperson added to The Register that it “will develop a database of customers that have been on a standard variable tariff for three years or more to target communications that encourage them to participate in the energy market. We will also be taking forward a programme of trialling which will, in part, focus on testing the most effective ‘prompts to engage’ for different consumer groups.”

"We recognise that there is a trade-off between the benefits of liberalising channels of engagement and the need to protect consumers from excessive and/or misleading marketing," Ofgem stated, and as such customers "will have the right to opt out beforehand to avoid receiving communications by post, and will only be contacted electronically if they explicitly opt in to such communications."

Operation of the database will have to comply with Data Protection Requirements and Ofgem will be required to put strict safeguards in place to protect against the misuse of data. Ofgem will also be responsible for ongoing monitoring of the impact of the database with a view to maximising its effectiveness.

An ICO spokesperson told The Register: “We understand the desire to ensure customers get the best available tariffs and any sharing of information must be done within the requirements of DPA and PECR. We made this clear to the CMA as part of its review. We welcome Ofgem’s recognition that protecting consumers personal data is a priority.”

The CMA additionally informed us that: "As part of the development of our database remedy we engaged with the ICO on matters relating to the Data Protection Act 1998 and the Privacy and Electronic Communications Regulations 2003 such as compliance and gaining the customer consent."

“Any forward engagement with the ICO would now be done by Ofgem as the body with responsibility for implementing this remedy,” the CMA added to The Register. ®

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