British Gas Business accused over predatory pricing

British Gas accused over predatory pricing

Utiltiy Week - 13 july 2007

ENERGY REGULATOR Ofgem has been urged by customer watchdog Energywatch to step into the row over alleged anti-competitive behaviour by British Gas Business (BGB).

The company has been accused of predatory pricing by undercutting rival suppliers when customers give notice of their intention to switch from BGB at the end of their contracts.

BGB denied that its behaviour transgressed the code on customer switching, but Energywatch business services manager Paul Savage said the company’s interpretation of the code was “unanimously opposed” by the rest of the industry.  “BGB’s behaviour is symptomatic of the increasingly aggressive moves among suppliers to retain customers,” said Savage.  “If this is consolidated into business practice it will damage the vibrant competitive market Ofgem says it wants.”

Business energy supply specialist Electricity4business also accused BGB of “unethical” practices in seeking to retain customers by using aggressive pricing tactics.

“This is an anti-competitive and possibly illegal incitement to breach a contract,” said a company spokesman.

Ofgem was due to publish its views on the row as Utility Week went to press, but the regulator said it wanted more time to consider its approach to resolving the increasingly bitter row.

• Electricity4business has published a guide that it is distributing to customers outlining what it says are sharp practices by the big six energy suppliers.  Chief among these are “evergreen” fixed-price contracts, which after a set period renew at a higher price unless the customer takes “timely action”.  A spokesman said customers could save £1,000 a year by being savvy to such tricks.