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Nick Clegg announces new energy deal agreement

Suppliers must tell customers their cheapest tariff

Nick Clegg

The Deputy Prime Minister today announced that he has secured a commitment from the major energy suppliers to advise all customers of the cheapest energy deal they offer.

The major energy suppliers – British Gas, SSE, Npower, Eon, Scottish Power and EDF – will write to customers once a year with information on the best tariff for them. 

Sending optimum tariff letters to customers was one of the key requests of the energy summit held in October 2011. Which? and other organisations asked companies to keep their customers informed about tariff changes, and advise them of the cheapest deal.

Which? executive director, Richard Lloyd, said: ‘Most people find it much too complicated to work out how much they should be paying for gas and electricity so these moves to make it easier to find a cheaper deal are an important step forward at a time when so many are struggling to pay their bills.’

Cheapest energy tariff

Which? research in October 2011 exposed widespread failings from some major energy suppliers in advising their customers on the cheapest deal. Our researchers, posing as customers, called the major energy suppliers and asked for the ‘cheapest’ tariff.  In around a third of the calls they were not offered the cheapest deal.

Mr Lloyd stressed how important it was for energy companies to build consumer trust: ‘There is widespread distrust of the energy industry and real anger at the way it has treated its customers for many years, with consumers collectively overpaying £4 billion a year for their energy by not switching to the cheapest prices.’

7 in 10 on wrong tariff

Nick Clegg told the press today that seven in 10 people are on the wrong tariff for their needs. One of the key aims of the new energy deal is to encourage more people to switch on to better deals. 

Energy companies often switch customers to a ‘standard’ tariff at the end of their contract, although this is often the most expensive one. Companies have now committed to telling customers the cheapest tariff when they reach the end of their contract term. 

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