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Existing customers are being barred from cheapest energy deals on offer

Authored by Phil Meekin

Phil Meekin

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Approximate read time: 2 minutes

Last month, the BBC reported that four of the UK’s largest energy providers have been barring their own customers from some of their best deals for gas and electricity. The cheapest deals on the market are usually reserved for new customers only meaning that existing customers are on expensive deals and paying hundreds more a year.

The four companies in question are British Gas, E.ON, SSE and EDF who have defended themselves by saying that they were simply responding to market changes and are trying to serve a wide range of customers. However since the findings from BBC’s Moneybox programme have been published, British Gas have withdrawn the tariff in question while the other three are still restricting their offers.

This kind of deal was banned by energy regulator Ofgem in 2014 but following a recommendation from the Competition and Markets Authority (CMA) in April this year, Ofgem stopped enforcing the rules. Regardless of this, the unearthing of such deals has surprised some leading figures in the energy industry.

Ken Geddes, chief executive of Energylinx, an energy price comparison business, tested the findings for himself last month. He tested a new customer only tariff with E.ON by applying as a current E.ON customer and then as a customer with another company. The price difference between the two tariffs he was offered was £260.

Speaking to the BBC about the findings, Mr Geddes said; “I’m just gob-smacked as to the difference in price”.

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Price differences for the other companies mentioned above hover around the £200+ mark putting existing customers at the back of the queue for good deals and not rewarding company loyalty. Although, some tariffs like this are being withdrawn by these companies, new attractive tariffs eligible for new customers only are popping up regularly.

Many experts feel that this problem is only being exacerbated by price comparison websites such as USwitch. These sites ask users for the name of their current provider removing new customer only deals by that supplier automatically. This means that these customers are not even aware of the difference in price between their existing customer deal and the price a new customer can obtain.

However, there is good news for consumers as not all of the major energy suppliers plan to or currently offer such tariffs. Scottish Power are one particular provider who will not be offering these tariffs. Their commercial director Colin McNeill spoke to the BBC regarding this issue; “These tariffs must stop… We must recognise that we are still not a trusted industry… Any of our customers can switch freely to any of our tariffs at any time.”

If you are worried that you are paying too much for your energy bills, it is worth checking your prices online and getting in touch with your energy company. It is quick and easy to switch energy providers so if you are unhappy with price or service, this is a good option for you.

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