Energy customers urged to switchTwo power firms criticised for not cutting bills

24 April 2007

 

Gas hob

Two energy firms are under pressure to cut bills after regulator Ofgem said their prices were lagging behind rival operators.

Ofgem said the average customer could save up to £140 a year by switching from Scottish Power and £122 a year by deserting EDF Energy for cheaper power companies.

The regulator added that more than 600,000 customers had changed gas and electricity suppliers in the first two months of the year – 22 per cent more than in 2006.

British Gas sparked a price war in February after announcing cheaper gas and electricity prices for customers following falling wholesale gas prices. The move prompted similar price cuts from rivals npower, Powergen, and Scottish & Southern Energy.

Higher bills

But Ofgem said customers of EDF Energy and Scottish Power were being left with higher bills by their suppliers.

Chief Executive Alistair Buchanan said: ‘Our research shows a big price gap has opened up, leaving EDF Energy and Scottish Power customers paying over £100 for remaining loyal.’

He added: ‘Competition is all about customer power - any supplier that tries to buck the market by not lowering their prices or failing on service risks an exodus of customers.’

A spokesman for Scottish Power, which has 5.2 million domestic customers, said: ‘We are still monitoring our pricing structure against the market.’

Cheaper prices

British Gas and Scottish & Southern Energy are the only two companies which have introduced their cheaper tariffs so far.

Npower and Powergen's price cuts are due to come into force on 30 April.

The regulator said that when the cheaper prices take effect, the average gas bill will be £595 and the average electricity bill will be £383, compared to £648 and £392.85 in January.

Ofgem has advised customers to shop around, switch to direct debit payments and manage their accounts online as ways of cutting fuel bills.

An EDF Energy spokesman said: ‘Our prices are continually under review. We are continuing to provide competitive prices, deliver excellent service and reward loyalty to all our customers.

‘We listen very carefully to what our customers are telling us and we will always do the right thing for our customers. Price is important but so are excellent service, social and environmental responsibility.’

Switch with Which?

Switch with Which? is the impartial and independent online service from Which?, that helps consumers compare and switch gas and electricity suppliers.

People using the Switch with Which? service can save on average £245* a year by changing their energy supplier(s).

* Average saving made on gas and electricity bills by UK households in 2006, using the Switch with Which? website.