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Does Switching Tariffs Really Save Money?

By Katie Anderson on February 16, 2012

An undercover investigation into tariff switching has revealed that many of the UK’s leading energy suppliers are guilty of misleading customers over prices.

The investigation, which aimed to establish whether switching tariffs between suppliers offered any financial rewards, was carried out by consumer group Which? earlier this month.

Requesting quotes from supermarket-based sales teams, Which? discovered that representatives for the suppliers often gave inaccurate or misleading information. One sales team quoted a saving of up to £142 for switching tariffs, but Which? later calculated that the majority of customers would be worse off by a figure of between £39 and £311 if they went ahead with the switch.

The consumer group believes that many of the sales teams base their calculations on a best-case scenario, in which the interested customer is assumed to be on a standard tariff with his current supplier. Standard tariffs are almost always the most expensive, but even when the sales teams were given the name of a cheaper tariff only half revised the original quote.

Clearly, supermarket-based sales teams can be accused of misleading customers if they knowingly provide them with inaccurate information to encourage their switching suppliers.

A second investigation by Which? revealed that two of the big six energy suppliers – British Gas and E.ON – did not always inform customers of the cheapest tariffs when asked directly over the phone. In supermarkets, only two out of thirteen sales teams told customers that more competitive deals were available elsewhere.

Which? Executive Director, Richard Lloyd, said: “It’s simply not good enough for energy salespeople to be quoting misleading individual savings to people who sign up to switch in supermarkets.

“It’s little wonder that trust in the energy sector is so low. We want the energy suppliers to build confidence among consumers that switching is both simple and worthwhile”.

The investigation suggests that the alleged profiteering of energy firms may be even more extensive than initially suspected. At a time when the cost of electricity and gas central heating is unaffordable for millions of households in the UK, energy suppliers should at very least be expected to provide customers with accurate figures and helpful information.