New pricing rules for British energy firms

Gas and electricity suppliers will have to give customers 30 days’ notice before hiking up prices after a new rule, which has now come into force, was initiated as part of a crackdown to make providers “play it straight with consumers”.

Previous rules allowed energy companies to write to customers up to 65 days after increasing prices, but energy watchdog Ofgem decided to bring in the new regulations to give households more time to switch their provider before bill hikes.

Under the new rules, energy suppliers will also have to give customers 30 days’ notice of any change to their contract that will leave customers significantly worse off.

All the “big six” energy providers have brought in price hikes in recent months, blaming the rising cost of gas and oil on the wholesale markets.

When the change was announced, Andrew Wright, Ofgem’s senior partner for markets, said the changes would “show that we are serious about making sure suppliers play it straight with consumers”.

Hannah Mummery, energy expert for Consumer Focus, said: “People clearly need to be given fair warning if prices are going to go up, not told months after the event. This welcome move will help give people the opportunity to budget for higher bills in advance, weigh up their options about whether to switch supplier and shop around.

“Ofgem has also made some strong recommendations from its energy market review which should also make it easier for customers to compare energy tariffs and switch to a better deal.

“The challenge now is for energy firms to deliver the changes needed to make switching work for consumers and give them confidence that they’re being asked to pay a fair price. The regulator must keep the pressure on until they do.”

Several energy companies have already started giving customers more notice since the proposals were put forward last year.

Energy UK director Christine McGourty said: “Energy companies are already working to ensure that all customers get the information they need in the time required to ensure full compliance with the new 30-day rule. In the last six months, the leading energy companies have all provided advance notice to customers of their price changes, going beyond the legal requirement at the time.”
Source: Press Association

Leave A Reply

Your email address will not be published.