Which? has criticised rules that allow energy companies to charge higher prices for up to 65 days without telling their customers.
The controversial rules mean consumers could wrack up higher electricity and gas bills for more than two months unaware that prices have increased.
The news comes just a week after Which? revealed the big six suppliers of gas and electricity – Npower, British Gas, EDF Energy, Eon Energy, Scottish Power and Scottish & Southern Energy – received some of the worst customer satisfaction scores Which? has seen across all industries this year.
You can watch thee Which? video guide to understanding your utility bill.
Energy price increases
Which? is calling on energy regulator Ofgem and the government to ban energy companies from notifying customers of price increases after they’ve taken effect.
Which? also believes the current rules could be unlawful. Courts and the Office of Fair Trading have previously ruled that contracts allowing a company to increase prices without notice are unfair.
We’ve encountered several examples of firms raising prices and not telling customers until at least a month later.
The Energy Retailers Association, which represents energy suppliers, told the Daily Mail it supports the current system.
Its chief executive, Garry Felgate, said: ‘The most relevant way for customers to hear about a price change, either up or down, is on their energy bill.’
Switching energy companies
One problem with the system is that customers who are unaware they’re paying a higher price might have wanted to switch supplier, had they known what they were paying. But another problem is that under the current rules, even if you do switch, there’s no guarantee your tariff will last longer than a few days.
Customers who get a bill telling them of a retrospective price hike have 10 working days in which to cancel, and prices are then recalculated at the previous rate for the energy they’ve used. But this relies on customers taking prompt action when they get their bill.
Which? senior policy advisor Dr Fiona Cochrane said: ‘Surely it’s not unreasonable for people to be warned in advance of price increases or for their new tariff to be guaranteed for at least the time it takes to switch supplier?’
To see whether you could save on energy bills, log on to the Which? energy comparison website Which? Switch.
Scottish Power price alert
Scottish Power customers on fixed-price energy deals that ended last month have until 15 October to switch without penalty.
Thousands of customers who took out a fixed-price plan last year will automatically be moved to a new 12-month capped tariff unless they choose to switch to another energy company. Those who switch after the October deadline will be charged a £50 exit fee.
Which? is campaigning for simpler energy bills. To find out about our campaign and get involved, see our Which? energy campaign pages.
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