Energy group Powergen launched new products to undercut rival British Gas today, but fell short of cutting prices for all of its six million customers.
The move comes after British Gas last week announced it would cut gas prices for all customers by 17 per cent after a fall in wholesale costs.
Powergen has launched two products and re-priced an existing tariff, which it says are guaranteed to be cheaper than British Gas for 18 months.
But existing Powergen customers not already on the re-priced tariffs would have to switch to take advantage of the cost savings.
Announcement due on price cuts
Independent energy watchdog energywatch today branded Powergen’s announcement an ‘attempt to buy some time’ before following British Gas in passing on lower wholesale prices to customers.
Adam Scorer, energywatch director of campaigns, said: ‘Any sign of competition on price is welcome, but Powergen’s six million customers, who have had to endure a 107 per cent increase on gas bills over the last four years, will be asking when the energy company will take action to cut prices for them.
‘Despite all the talk from energy suppliers, consumers have had only one announcement of a real price cut. It’s time for companies to stop talking like a good market and start acting like one.’
Powergen spokesman Nick Sandham said it was ‘quicker for us to get the new products to market’ than to make the price decreases for all of its customers, but added the group will make an announcement shortly.
Wholesale prices began to fall last summer and energy suppliers have come under fire for the delay in offering cuts to customers.
Which? researcher James Tallack said: ‘The reluctance of many consumers to switch supplier because they think it’s complicated or that they’ll get cut off, and a general lack of awareness about the savings that can be made by switching, is being capitalised on by energy companies who don’t pass price cuts onto all their customers.’
Switch with Which?
Which? runs its own impartial energy price comparison site – Switch with Which? – where you can check which supplier offers the best deal for your gas and electricity.
People using the Switch with Which? service can save on average £250* a year by changing their energy supplier.
* Average saving of people who switched using the site between 01 January 2006 and 30 July 2006 inclusive.