Big Six energy customers pay a high price for loyalty

● UK households have forked out an extra £ 7.3 billion in the last five years

UK households have forked out an extra £ 7.3 billion over the last five years by remaining customers of the Big Six energy firms, a report shows.

Ofgem data compiled by energy provider Bulb found that families who held accounts with the biggest firms – British Gas, SSE, E. ON, N power, EDF and Scottish Power – for at least five years paid out an average £ 853 more than they needed to over that period.

The report explained that, whileBig Six firms tend to offer cheaper fixed tariffs to “entice” new customers, those tariffs tend to expire within one to two years.

At that point customers are usually transferred to standard variable tariffs, which cost up to 30 per cent more than their original plan.

The report went on to calculate the so- called “loyalty fee”, which measures the annual price difference between the average standard variable tariff at a Big Six firm compared with its cheapest tariff.

It found that the average loyalty fee for a UK household was £ 852.75 over five years.

Bulb co-founder Hayden Wood said: “Loyalty towards abrand is often rewarded, yet households who’ ve put their trust for years in a single energy company are being forced to subsidise others who switch every 12 months.”

0 Customers of the Big Six paid an average £ 853 more than they needed to over five years, said report

He added :“These latest numbers show that so- called standard tariffs no longer have the customers’ best interests at heart. The Big Six need to show that they’re putting customers first, instead of profits.”

A recent poll by uS witch found a third of Britons are already concerned about paying their energy bills this winter and more than half are struggling with their house - hold finances.

British Gas became the latest Big Six energy supplier to raise prices at the start of this month, when it confirmed that it was ramping up the cost of electricity by 12.5 per cent for 3.1 million customers, despite falling wholesale prices.

The company had promised in December it would freeze tariffs until this summer, while rivals including Scottish Power, E. ON and EDF raised bills near the start of the year. SSE raised dual fuel prices by 6.9 per cent in April, while N power came under fire in February amid plans to hike gas and electricity prices by 9.8 percent–a move that added £ 109 to annual dual fuel bills.

“These latest numbers show that so- called standard tariffs no longer have the customers’ best interests at heart.” HAYDEN WOOD