After a 12-month investigation, the Competitions and Markets Authority (CMA) revealed that energy customers are not shopping around enough for cheap energy plans, and large energy suppliers may have taken advantage of this fact.
The July report, solely focussed on the energy market, stated that the big six suppliers had collectively overcharged customers by £1.2billion, which possibly triggered some suppliers to take note as cheaper deals were announced in the days after, including British Gas.
British Gas announced they would cut 5% off of their gas price for standard (variable) tariff customers, which would also be replicated by white label Sainsbury’s Energy.
£35 off the annual bill
The 5% cut equates to £35 off of the annual standard tariff bill. This follows the same cut made in January of this year, making British Gas the only big six supplier so far to have made two cuts in 2015.
Ann Robinson, Director of Consumer Policy at uSwitch.com still believes this latest effort falls short:
“Although British Gas’ price cut is welcome, its average dual fuel standard tariff customer will see their annual bill cut by less than 3%. Single digit reductions in bills fall well short of the double digit drop in wholesale energy prices.
“Even after today’s price cut, there is a £320 a year difference between British Gas’ standard tariff and the cheapest deal on the market, so many of its customers would be better off by switching.”
Many are still waiting for the big six to slash prices further in-line with falling wholesale costs, as smaller suppliers remain the cheaper option.