Energy firms in 'best deals' pledge

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Gas flameHard-pressed families stand to save up to £100 a year under a "long overdue" agreement to ensure the UK's biggest energy suppliers are offering customers the best deal.

The "big six" utility companies have agreed with the Government to write to customers at least once a year to help them identify the best tariff available from within that firm and how to switch.

Some 70% of households pay more than they need to because they are not on the best rate, while there are 120 tariffs from which to choose.

Energy providers - such as British Gas, Npower and EDF - have come under pressure to curb price rises and to improve transparency as household incomes are squeezed by high inflation and low wage growth.

Consumer groups broadly welcomed the move but said more was needed to ensure customers were receiving the best deals and prices did not shoot upwards.

Audrey Gallacher, director of energy at Consumer Focus, said: "While any move to help energy customers to get the best deal is welcome, it has to be the right method to reach people and the benefit must outweigh the cost.

"This needs to be more than a one-off mail shot and part of a wider strategy to help people overcome the burden of having to navigate hundreds of complex tariffs to get a decent price. Unfortunately, people don't trust energy firms and previous mail-outs have not always had the best take-up."

Unveiling the agreement, Deputy Prime Minister Nick Clegg said: "These are the kinds of changes that help people save money, that get us thinking about the energy we use, that promote the kind of thrift that is good for pockets as well as the planet."

The agreement will also see companies printing barcodes on bills, allowing customers to scan the code on their mobile phones, linking them to the best energy tariffs.

A spokesman for Ofgem welcomed the announcement, saying: "Our retail market review showed the energy market is too complex and that further action is needed to make sure the market works in the interests of consumers."

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