Time to switch? Big six energy firms overcharging loyal customers up to Â£234 a year
An investigation by a competitor regulator found that some long-term dual fuel consumers spend Â£234 a year more than those who shop around.
17:59 18 February 2015
In a progress report conducted by the Competition and Markets Authority, it was found that 95per cent of loyal dual fuel customers on standard variable tariffs are spending as much as £234 a year more than those who shop around.
The report also revealed that majority of customers who did not switch providers between early 2012 and early 2014 are more likely to be on low incomes, to be over 65, and living in social housing and without qualifications.
“We have observed that the six large energy firms have consistently charged higher prices for the SVT for gas and electricity compared with non-standard tariffs, which provides some support for the view that these suppliers can segment the market and price discriminate,” the regulator said.
Meanwhile, Ed Davey, the energy secretary, said: “What I’m looking forward to with this inquiry is to see evidence of whether we need to go further and faster and we won’t flinch if that is what’s needed.
“If some of the energy companies are abusing their market power I think that is actually wrong … because they are giving the best deals for new customers and not sharing some of the benefits with their loyal customers.
“I’ve always said if there needs to be further action I certainly wouldn’t shrink from seeing an energy company broken up but that has to be done with real evidence.
“If the evidence from the CMA is that the next step ought to be broken up, I as a Liberal Democrat will make it clear we wouldn’t flinch from taking that tough action.”