By Naphtalia Loderick
Electricity and gas suppliers will have to give customers 30 days advance notice of any price rise, under new rules by regulator Ofgem.
Currently, energy firms have up to 65 days to notify customers AFTER they have put up prices.
The rule change, first proposed by energy regulator Ofgem last September, comes into effect on 28 April 2011.
Industry reform
The reform is a win for households as it will allow customers time to switch tariffs or energy suppliers before any price rise kicks in. It forms part of Ofgem’s shake-up of the energy industry.
Earlier in March, following a review of the energy market, the regulator proposed an overhaul of the market in order to provide a better deal for consumers.
The review found poor behavior by energy suppliers, too many confusing tariffs and evidence that suppliers were raising bills more quickly than they lowered them when wholesale energy costs fell.
Andrew Wright of Ofgem said: "These changes will again show that we are serious about making sure suppliers play it straight with consumers.
‘End to complex tariffs’
“We believe that 30 days advance notification of price increases, coupled with our new proposals for more transparency and an end to complex tariffs, will give consumers more power to make informed switching choices."
Customer watchdog Consumer Focus called the new rules a “long-awaited move”.
Audrey Gallacher, head of energy at Consumer Focus, said: ‘If people are going to pay more for their energy, clearly they need to know in advance, not as much as two months later.
“This long-awaited move should help customers to budget for any price rises and make informed decisions early on about whether to switch supplier.”
Switch for the best deal
There’s no need to do anything right away but keep an eye on your energy bills so you are ready to switch if you are notified that prices are going up.
It’s worth knowing your monthly energy usage so you have this information to hand when you are ready to switch and remember to look out for the latest deals and compare energy suppliers.
If you want to know more about how to switch energy suppliers, read our step-by-step guide to switching. And if you’re puzzled by your energy bill take a look at our simple guide to understanding your energy bill. And finally, learn whether you are a low, medium or high energy user by reading your energy usage group.
