Householders in Britain who want to sign up to a new energy company are apparently being obstructed by the largest suppliers, in potential breach of their licence obligations.
The “big five” energy companies are informing those who apply online for a tariff that they should remain with their current supplier because of the volatile energy market. According to the industry regulator, Ofgem, suppliers are obliged to accept new customers as a condition of their licence.
The issue emerged after some consumers reported being unable to find another supplier who would take them on. Some said that when they applied for a quote, a message said they should remain with their current supplier and that the company was not providing quotes.
Michael Donagy, a student and retail assistant, said he had been left in limbo after moving into a new home, unable to open an account in his name with the current supplier and unable to switch to a new provider because none would respond to online requests.
“When I filled out the web form for the current supplier, a message told me to stick to my current provider!” he said. “I’ve tried to call and it was a task just finding a phone number on the website, and I’ve spent a total of three hours on hold without getting through.”
In July, Ofgem launched a long-planned “switching programme” to make it easier and faster for customers to switch supplier. The aim is to strengthen competition in the energy sector by encouraging customers to shop around.
However, soaring energy prices have ended competitive fixed-price contracts, with the mandated Ofgem price cap usually the best tariff available. That annual figure for the typical household had been due to soar to £3,549 from 1 October, before Liz Truss announced earlier this month that it would be reduced to £2,500 for the next couple of winters.
Many price comparison websites no longer offer quotes to allow consumers to identify the best deals. However, one of the most common reasons customers choose to switch is poor customer service, according to Martyn James of the complaints website Resolver.
“Just because there aren’t any switching deals doesn’t mean people won’t want to switch,” he said. “I’ve seen some frankly jaw-dropping examples of poor service, ludicrous errors and blocking of complaints in the last month alone.”
The Guardian attempted to obtain tariffs from British Gas, E.ON, EDF, ScottishPower and Ovo Energy. All five websites stated that they were not currently providing online quotes and claimed that customers were better off remaining with their current supplier.
British Gas confirmed via web chat that it was not currently accepting new customers because Ofgem advised against switching while prices remain volatile.
EDF and ScottishPower told the Guardian they would accept new customers on a standard variable rate by telephone, an option not mentioned on their websites. However, EDF’s contacts page told customers only to use its busy phone lines in an emergency, and ScottishPower referred people back to the website due to high call volumes.
An E.ON spokesperson said: “With energy prices at a record high, it is recommended that customers stay with their existing supplier. However, customers can sign up to receive an alert as soon as we are in a position to offer competitive fixed-price tariffs for new customers, or can call us to discuss their tariff.”
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British Gas and Ovo did not respond to requests for a comment.
Ofgem denied British Gas’s claim that it had advised customers to avoid switching. “In fact, suppliers must take on new customers when approached by them,” a spokesperson said.
The regulator declined to confirm whether it was aware of suppliers blocking new customers, but said it investigated companies that it believed may have breached one or more conditions of their licences.
After the Guardian submitted evidence of its findings, it added: “We hold suppliers to account on [accepting new customers] by using all forms of intelligence shared with us.”
Some companies, such as Octopus Energy, have been allowing new customers to sign up. Although the firm also declines requests for online quotes and advises customers to stick with their existing supplier, it does in the small print provide a number for those who still require a quote.
