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E.on and British Gas; frozen standard tariffs this winter.

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imagesBritish Gas and E.on are freezing their standard tariffs for this coming winter. Both the gas and electricity bills will now affect, in total, around nine million customers. There will be no increase in charges until at least April of 2017, both suppliers have promised. This decision was made following similar actions taken by SSE, who also said that they will freeze their standard tariffs for the same period of time. The decision was made amongst mounting political pressure on the big suppliers to treat the loyal customers more reasonably. British Gas made their announcement in a series of adverts in national newspapers, during which it was said that their standard tariff would “remain unchanged through the winter”, this is understood to last until the end of March 2017 at least. 

 

The consumer group ‘Which?’ welcomed the announcement. however, they also said that standard tariffs were the most expensive on the market , and that customers should consider the idea of switching from them. Alex Neill, the managing director of home and legal services at Which? said “Energy companies should be doing much more than simply freezing their prices this winter.” “We want them to set out what they’re doing to genuinely engage with customers who are stuck on these poor-value deals,” said Alex. However both E.on and British Gas had promised to do all they could to make customers aware of the best deals. “We will continue to engage our customers on a wide range of topics including making them aware of their different tariff choices, helping them to use no more money than they need and getting Smart meters into homes across Britain,” E.on said.

The changes appear to be designed to counter criticism that big energy firms are taking advantage of customers that do not switch their supplier. Last month, industry representatives met with Business Secretary Greg Clark amid claims that the energy suppliers were making a profit off of their loyal customers. In a statement at the time, he said that “customers who are loyal to their energy supplier should be treated well, not taken for a ride, and it’s high time the big companies recognise this”. “I have made clear to the big firms that this can’t go on, and they must treat customers properly or be made to do so.”

 

Following the rising wholesale prices, a number of small energy suppliers have increased prices in recent weeks. Although, industry experts believe that the big six are rather unlikely to increase their standard tariff prices, as they would have already brought gas and electricity for delivery, in the coming months at lower prices. There are big differences between the standard tariff prices and some of the cheapest fixed price deals on the market, that consumer groups have highlighted.  According to the comparison site uSwitch, the Britsh Gas standard tariff is the cheapest of the big six, at an average of £1,044 a year. However, this is still £182 more than the best deal on the market. British Gas now say that the price difference between their standard tariff and their cheapest deal is now just £40 a year.

 

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