Websites 'push up energy bills'


Gas fire

Price comparison websites push up the cost of energy bills because of the commission charged to suppliers, the head of Co-operative Energy has claimed.

Co-operative Energy group general manager Ramsay Dunning suggested that money spent on comparison websites could otherwise be going towards reducing consumers' bills.

He told Sky News: "A lot of money goes on advertising of the comparison websites, and that goes through to the commissions that energy companies such as ourselves and all the others have paid to the comparison websites.

"And if that money wasn't going on TV advertising, on radio advertising, on national newspaper advertising... it could go to reducing bills."

Price comparison website uSwitch hit back in a statement, saying that such websites have been doing " all we can to champion small suppliers and to help consumers in the face of higher energy prices".

uSwitch said that over 90% of its visitors simply gather information and advice rather than going on to switch.

Its statement continued: "We are upfront and open about the fact that this is paid for by fees we receive from suppliers when somebody switches - we receive no other funding.

"The commission we receive also pays for our call centre so that we can help those who aren't online. The important thing is that we will always show somebody the cheapest deal for their needs regardless of whether we have a commercial agreement in place with that supplier or not.

"The reality is that comparison sites are a very cheap method for suppliers to acquire new customers in a fair and unbiased way. To suggest that we are helping to push up the cost of energy is simply ridiculous."

A spokesman for Ofgem said: "Price comparison sites play an important role in helping energy consumers compare deals.

"Ofgem has taken over the running of the code of practice for such sites and we are reviewing it to ensure that its objectives are in line with our reforms for a simpler, clearer, fairer energy market. We will be consulting on this in spring."

The spokesman said the code of practice is there to protect consumers in a number of ways.

He said: "For example, switching sites have to state which suppliers they earn commission from. They also have to make sure that they do not rank tariffs in accordance with the suppliers from which they are earning commission."

Earlier this week, energy giant Npower claimed bills in the UK are high because the country's "old and draughty" houses waste so much gas and electricity.

Npower chief executive Paul Massara said the actual unit prices of gas and electricity in the UK are among the lowest in Europe - but bills are high "because British houses waste so much energy".

Audrey Gallacher, director of energy at Consumer Futures, said: "There's a big issue about how sites are regulated and more importantly their transparency on commission costs. Consumers deserve to know that."

She said the regulation needs "to ensure that there aren't any underhand tricks that are driving consumers to the deals where these sites make money".

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