An important component of a utility’s reputation is the company’s strategy towards its vulnerable customers and those struggling to pay their utility bills.

Ofgem’s newest scheme to help companies address fuel poverty is Warm Home Discount Regulations 2011 that came into effect on 1st April 2011 and supports vulnerable customers more effectively by offering better targeted support to a greater number of customers in or at risk of fuel poverty.

Based on Ofgem figures, the Big Six’s collective expenditure for the period 2009-2010 was £153m, 74% representing social and discounted tariffs, 10% rebates and discounts, 8% Trust funds, 5% Energy efficiency initiatives and 3% other initiatives.

Although the total expenditure significantly exceeded the government’s target of £125m, it represented a 3% decrease from 2008-2009 when the total spend was £157 million.

Among the Big Six, British Gas contributed the most, spending approximately £3.75 per customer account for its charitable options.

EDF Energy appeared to be the lowest contributor for the period with an average of £2.55 spent per customer account with no offer of rebates or energy efficiency schemes.

E.ON offered the greatest variety of social spend including social and discounted tariffs, rebates, trust funds, initiatives and had the greatest spend in energy efficiency activities among the Big Six.

Among utilities, which often see low reputation scores for Products & Services Execution, Social Performance is often the aspect of their reputational performance that scores most highly.

Looking more closely at the figures, Social Performance was the highest ranked reputation driver* for utilities companies with an average score of 6.90 for the period Sept 2010 to April 2011 – a high score overall. Social spend on behalf of utilities often generates a large share of positive coverage, improving the company’s profile in the eyes of the general public during times when consumer confidence and trust are at their lowest levels.

These types of stories often feature strongly in developing a company’s relationship with local communities and typically generate large coverage in regional press and locally-focused social media sites.

With predictions of an ever increasing utility debt problem, utilities are taking a much greater interest in measures to support their vulnerable customers and improve their profile in the eyes of regulators, government and consumer bodies.

Measures such as the above are a cost effective way of enhancing a company’s positive perception by these stakeholder groups and contributing to improving its overall reputation.

Alva’s 6 reputation drivers are: Corporate Culture, Corporate Leadership, Financial Performance, Products & Services Execution, Social Performance and Stakeholder Engagement.

Alva’s methodology

Alva calculates its reputation scores on a 1 to 10 fractional value basis, which represents the perception of various stakeholders and market segments at any given point in time.

The scores are based on the daily analysis of over half a million news and financial announcements, trading and analyst reports and social media comments.

————– Nicholas Chrysanthou, energy consultant analyst at Alva