Energy suppliers will have to admit to their customers they would be better off switching to their partner brands from October.
Called ‘white label’ providers, they do not hold a supply licence but instead work in partnership with a licensed supplier to offer gas and electricity using their own brands.
Under Ofgem’s current regulations, energy firms have to tell customers about their cheapest deal and the rule is now being extended to white label tariffs.
That means British Gas and SSE will have to advise their customers they could get cheaper deals with Sainsbury’s Energy and M&S Energy.
Ofgem had initially proposed for energy companies with white labels to inform customers of the cheapest tariffs from July but it has extended the date following a consultation.
A spokesperson told ELN suppliers’ main challenges related to IT changes and staff training and the initial time frame was not sufficient for them.
Rachel Fletcher, Ofgem senior partner said: “Selling energy through white label brands has the potential to increase consumer choice and engage consumers to shop around through well-known brands. But it is important that consumers are given the complete picture about all their supplier’s tariffs.
“We are acting to reduce barriers to white labels entering the market and to ensure suppliers tell their customers what the cheapest deal is for them, whatever brand it is marketed under. Transparency about the cheapest tariff that a supplier offers is important in rebuilding consumer trust in the market.”