Regulator to probe gas ‘switching’ fees

OFGEM has opened an investigation into British Gas following concerns raised about its terms for customers who switch to another supplier.

The regulator said the investigation will examine if British Gas breached licence conditions relating to its obligations to customers who switch away from the company, including the requirement to waive termination fees.

This investigation followed concerns raised by consumer affairs website Money Saving Expert, Ofgem said.

Ofgem rules state that suppliers should not charge termination fees for any switch that takes place within the 49 day “switching period” before the end of a fixed term contract. It stressed the opening of the investigation “does not imply that we have made any findings about non-compliance”.

British Gas said: “British Gas will co-operate fully with Ofgem to address the issues raised in today’s announcement.”

Money Saving Expert (MSE) sent a letter of complaint to Ofgem in March after finding that “many customers” on fixed term contracts with major suppliers had been “wrongly told they would have to pay to switch”.

MSE said that while there was no evidence that anyone had actually been wrongly charged exit fees, many said they had been put off switching by the misinformation.