Energy suppliers will have to admit to their customers that they would be better off switching to their partner brands under proposals published by Ofgem.

That means British Gas and SSE could be forced to advise their customers they could get cheaper deals with Sainsbury’s Energy and M&S Energy.

Both the small suppliers are so-called “white label” energy providers, which means they don’t hold a supply licence but sell gas or electricity of a licensed supplier under their own brand name.

As part of Ofgem’s reforms to make the market simpler and fairer, suppliers are obliged to tell their customers about the cheapest tariff they offer. But they are under no obligation to mention their partner brand offers the cheapest deal.

Ofgem is now proposing that suppliers should inform their customers about cheaper deals their white label brand offers.

“From next year, if the white label provider offers a cheaper tariff than British Gas’ in-house tariff, then they would have to notify their customers in every bill and annual statement”, an Ofgem spokesperson told ELN.

However, there will be no restriction on the number of white labels a supplier can have.

Ofgem is seeking views on its proposals and has launched a consultation which ends on 6th November 2014.