The Energy Advice Line has welcomed calls by Ofgem for consumers to switch energy suppliers now in order to save up to £250 a year on their gas and electricity bills.
The call followed confirmation by the regulator that energy companies were failing to fully pass on the fall in wholesale gas prices they had enjoyed in the past year.
Quizzed by MPs this week about why suppliers had failed to deliver bigger price cuts to consumers, Ofgem chiefs agreed this was a “cause for concern”.
But they said they were focusing on encouraging consumers to change suppliers to make savings, adding, “generally it is a good time to switch”.
Julian Morgan, managing director of the price comparison, switching and advice service for energy consumers, said Ofgem’s advice was sound even when retail energy prices were falling.
“Most of the Big Six suppliers have now announced reduced charges for household gas after prices they pay in the wholesale market have fallen,” Mr Morgan said.
“However, this does not mean that consumers can sit back and assume they will enjoy dramatically lower bills. Sadly, this won’t be the case.
“Ofgem itself has raised concerns about why the size of the cuts being passed on are so small, and has pointed out that the best way for households and businesses to make the most of falling gas prices is to shop around, find the best deals and switch accordingly.”
The committee of MPs this week heard that Ofgem forecasts that customers' average dual-fuel bills will now drop by £21 to £1,305 in the year ahead.
At the same time, the profit margin per customer of a typical large supplier will rise to £114, £9 more than Ofgem estimated last November.
Energy companies have argued that the wholesale price of gas only makes up about half of a domestic energy bill and that they therefore cannot pass on the entire fall in the price they pay for energy.
But Mr Morgan expressed disappointment that the regulator and energy companies were still unable to agree on the basics of costs, prices and profits in the energy market after years of discussion.
“Suppliers and the regulator are still bickering about how profit margins are calculated, which is very disappointing and of no help to consumers at all,” Mr Morgan said.
“What ordinary energy bill payers need is a transparent and competitive energy market so that they can make fully informed choices."
The Energy Advice Line is one of the UK's leading price comparison and switching services for business and domestic energy customers. It is also an advocate for energy market reform and has campaigned for a better deal for energy users, including calling for a ban on cold calling and changes to regulations to make it easier for all consumers to switch suppliers.
The service is completely independent and free. Consumers can quickly and simply search the market for the best available energy deals from an extensive panel of small and large energy suppliers. The service also offers a free advice line for business energy customers.
For further information visit www.energyadviceline.org.uk