Britain’s Big Six energy firms will have to tell their customers if they can get a cheaper energy tariff under new plans revealed by the Deputy Prime Minister today. Nick Clegg claims the new policy could save millions of people money on their bills.
The major energy suppliers, EDF, E.ON, British Gas, npower, SSE and ScottishPower have signed up to the “landmark deal” with the Coalition.
Every year they will now write to customers to tell them what the best tariff is for them and how to get it.
Customers will also be offered the best tariff if their contract comes to an end and if they contact their supplier at any time to ask.
This marks a huge departure from many current policies, with some energy tariffs being ‘rolled over’ without asking customers if they want better deals.
At a speech at ‘Canary Wharf’s greenest building’, the KPMG headquarters, Deputy Prime Minister Nick Clegg is expected to say: “I know that many families are struggling with rising energy bills. We can’t control volatile world energy prices. But we can still help people get their bills down.
“Right now, seven out of 10 customers are on the wrong tariff for their needs, so are paying too much. Yet people rarely switch, despite the fact some families could save up to £100 a year. There are currently over 120 different tariffs, making it very difficult to know where to start.
“That is going to change. As of this Autumn, your supplier will have to contact you with the best tariff for your needs. And if you call them, they’ll have to offer you the best deal too.”
The Government is also looking into putting barcodes on bills which people can scan with their smartphones to find quotes and online switching.
Suppliers welcomed the agreement on energy tariffs as “realistic”.
SSE Chief Executive Ian Marchant said: “The package of measures announced today gives us a substantive but realistic set of targets which we believe are achievable. The commitments we have implemented so far are setting the pace for the rest of the industry, going right to the heart of the issues that concern customers. They will improve both communication and simplicity for customers.”