MILLIONS of people are being kept in the dark about cheaper energy deals that could cut hundreds of pounds from their annual bills.
Gas and electricity suppliers are required to draw attention to cheaper tariffs under rules introduced last year. However, an exemption was made for “white label” rates in which energy giants sell supplies under another company’s name.
British Gas, the country’s largest energy company, sells gas and electricity through Sainsbury’s, while SSE, another of the big six, sells through Marks & Spencer.
The loophole means British Gas does not have to tell customers that they could cut their bill with Sainsbury’s even though it supplies the gas. It was supposed to be closed by the end of this year, but watchdog Ofgem has quietly extended the deadline to December 2015.
The extension has come to light as new figures show that British Gas’s 11m customers are paying around £200 more a year to heat and light their homes than those who buy through Sainsbury’s.
The supermarket advertises a fixed price until January 2016 of 12.89p per kilowatt-hour for electricity and 4.41p for gas, which it says means the average annual bill is £999.
The same usage would cost customers £1,203 with British Gas’s “fix & reward” rate, which runs until February 2016, a difference of £204, according to Labour party calculations.
The energy firm said that using a direct debit to pay the bill would cut it to £1,184, or £185 more than Sainsbury’s.
Ofgem said it intended to force energy giants to tell customers about white label deals within six months.
However, Caroline Flint, the shadow energy secretary, said the watchdog should act now. “It’s outrageous that energy companies are allowed to get away with hiding cheaper deals,” said the Labour MP.
“If British Gas can sell energy for £200 a year less with a Sainsbury’s logo, there’s no reason why they shouldn’t cut bills for ordinary customers too.”
A spokeswoman for British Gas said customers could see white label tariffs on price comparison websites.
“We tell our Sainsbury’s Energy customers if there could be a better Sainsbury’s Energy tariff for them in every bill and do the same for British Gas customers with British Gas tariffs,” she said.
“It would not be appropriate to promote across the two brands as the products and services would not be comparable. Sainsbury’s Energy is more of a ‘no frills’ service with internet-only accounts, no smart meters yet, no pre-payment meters and payments are by direct debit only.”
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