Energy firms accused of ‘flouting’ rules by trying to charge customers exit fees despite fee-free switching window
Npower, British Gas and E.ON have been accused of telling customers they could be charged for switching supplier at the end of their contract
THREE of the biggest energy suppliers in the UK have been accused of wrongly telling customers that they will face an exit fee for switching to a different supplier at the end of their contract term.
Following an investigation by MonySavingExpert.com, the energy regulator Ofgem confirmed that it would be talking to some of the big six energy firms to discuss the issue.
MSE said that its investigation revealed many customers approaching the end of their fixed-term tariff had been wrongly told they'll have to pay to switch.
But the regulator's rules on penalty-free switching are "extremely clear" it said.
If you're in the last 49 days of your fix, you do not have to pay an exit fee and can switch to a different provider without cost.
MSE said that despite crystal-clear regulation, it had received evidence of customers being given false information by energy companies since December.
The personal finance website called out npower, British Gas and E.ON for flouting Ofgem’s rules.
The website said that it had been contacted by npower customers who applied to switch within the final 49 days, but received a confirmation email telling them they’d have to pay exit fees.
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In January, despite assurances that the “system error” causing these emails was being fixed, MSE continued to receive new evidence from customers still being given incorrect information, it said.
MSE also said it been alerted to a British Gas deal where the terms and conditions wrongly suggested that exit fees would be charged, and that E.ON had also given out wrong information.
Archna Luthra, head of energy at MoneySavingExpert.com said: “It is absolutely outrageous that energy suppliers are so blatantly flouting the rules.
"These rules were put in place to protect consumers and give them the confidence and time to switch to a better deal at the end of a fix.
"Exit fees can be up to £100, so the threat of being charged is a significant one. Energy prices are rising so it is vital customers are able to switch to a cheaper tariff without being misled."
MSE has sent a formal letter of complaint to Ofgem about the issue, along with a dossier of evidence showing how customers have been misinformed.
On receiving the complaint, Rachel Fletcher, senior partner for consumer and competition at Ofgem, said: "We are concerned that consumers are potentially being misinformed about their right to switch fee-free during the switching window at the end of fixed term contracts.
"We are following this up with suppliers as a matter of high priority, and we will work to make sure action is taken where it’s needed."
British Gas told The Sun Online: “We are surprised MoneySavingExpert.com have raised this now. They are referring to a set of terms and conditions published in 2015.
"We wrote to all the customers on that tariff and made it absolutely clear that they would not be charged if they switched during the 49-day window.”
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AROUND 70 per cent of people are on bog-standard expensive standard tariffs, when they should be shopping around for a cheaper energy deal. If in doubt, call your provider and call other suppliers to ask them what their cheapest fixed tariff is.
Better still, use a comparison website, like Energyhelpline.com, uSwitch or MoneySupermarket to find the very best deal for you.
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A spokesperson for E.ON said: "MSE contacted us about an individual customer complaint in January and we confirmed at the time that we believe that to be an isolated incident and that our policy is aligned with the fact customers wishing to switch to another supplier in the last 49 days of their fixed-tariff can do so free of exit-fees.
"With regard to the specific complaint we apologised and made clear that we were very sorry that, on that occasion, there was some confusion regarding our penalty-free switching period for fixed-tariffs.”
Npower said: "We would like to offer our reassurances that the error was solely in the wording of the letter and no termination fees were actually charged to customers.
"We have already taken action to resolve the issue and we're contacting any customers who received the incorrect letter (and not switched). We have also stopped issuing letters (which may have contained the error)."
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