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Do energy adverts really deliver the hottest deals?

Signpost directing people to sales and special offers

From ‘cheapest deals’ that aren’t the cheapest, to ‘free’ months of energy that save you less than £4, we have found some energy ads that aren’t what they seem.

Adverts from gas and electricity companies are a familiar sight throughout the year, with tempting offers for new or existing customers. We looked at energy adverts over more than a year and selected seven that we think could be misleading. These ads make tempting claims, either by promising money off or free energy, or by claiming to be the cheapest.

We asked more than 1,000 people for their views about these ads. Worryingly, for most of the ads we looked at, a high proportion of people said they would have been tempted to switch to the advertised deal and many believed that they were good offers.

The challenge of choosing the cheapest deal

An advert from EDF claimed that it was the cheapest for standard dual fuel out of all the major energy suppliers. Of the 1,000 people, three quarters agreed this ad implied EDF was cheaper than all the other energy suppliers. In fact, the cheapest dual fuel tariff at the time came from First Utility at £1,030. That’s £99 less than EDF’s standard tariff.

In the same period, British Gas also claimed to be the cheapest in one of its adverts. This time, the ad claimed British Gas had the cheapest standard electricity for average consumption of any major supplier. At the time, British Gas was cheapest for electricity, but not for dual fuel. And Npower claimed to be cheaper than British Gas. All very confusing, as our video shows:

Eon published an advert that offered customers two months’ worth of free energy. Nearly half of those we asked said this looked like an attractive deal. Unfortunately, the small print stated that ‘payment and online discounts [are] not available’. Customers on this deal would not receive the normal discounts of 8% for taking dual fuel and paying by direct debit. The actual added discount was only 0.33%, amounting to a £3.80 saving on the average annual bill.

We reported our findings to the energy companies. British Gas and EDF told us that they did not receive any complaints about their adverts. Eon apologised for its advert and told us that it withdrew the tariff following feedback.

Do you find some deals on energy adverts attractive? Would you be tempted to switch suppliers by an advert for an energy deal?

Do you trust adverts for energy deals?

No (84%, 218 Votes)

I'm not sure (14%, 37 Votes)

Yes (1%, 3 Votes)

Total Voters: 267

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Comments
Member

I’m astonished that “a high proportion would have been tempted to switch”. Surely so many are not as gullible as that? I don’t trust adverts of course – they are dreamt up solely to tempt you to buy their product (obvious) which may well not be the right product for you. It only takes a bit of effort to reach your own conclusions.

Member

With something as important as energy, the government should be controlling what tariffs are available and negotiating the maximum prices companies can charge. If companies want to undercut the fixed prices, offer Tesco Clubcard points, etc. then fair enough.

The amount companies are allowed to spend on advertising should be strictly controlled.

Member

wavechange – proper competition should deal with this. First thing is to make sure it is proper. Otherwise what else should the government then control? Food – absolutely essential to us. Water. Housing. Transport (most travel to work). I would not want state control – they are not competent, and decisions would not be decided on value-for-money grounds, but on tax revenue, political expediency (lets cut energy costs, there’s a general election coming up). Better surely to have an effective, properly resourced non-political consumer group that can properly investigate these key matters and make them public. Who does that at the moment? I don’t think anyone. Perhaps it needs more funding.

Member

Competition does not always work, especially when there are few players. You have just posted a message about the fact that your local fuel prices are all very similar.

I don’t know the best solution but I think we can exclude nationalisation, based on experience in our lifetime. The advantages of government control of maximum price is that it need not cost a fortune or take years.

Member

wavechange, the point I was making is I don’t think government is competent to do this. It can’t even organise competition in it’s own departments – try Defence, NHS, for example. I believe we need a strong consumer group – it is we, the consumers, who buy all this stuff so, properly organised, we should have the power to ensure we get a fairer deal. Where is that strong consumer group going to come from? I made the point about petrol and diesel prices for exactly the same reason.

It would be interesting to know what industry (and nastional / local government) pays for energy and fuel, as many of them are major purchasers and you’d expect them to sort out proper deals.

Member

But surely Government does not have to “run” re-nationalised energy supply, the supply only needs to be state owned so the profit comes back to the public purse.
The various existing private organisations could remain, and they could remain in competition with each other, but if they’re all state owned the profits come back to the nation rather than a collection of shareholders some of them foreign, and these profits could then be used to make things more efficient, cheaper and better all round.
A modern slant on nationalisation perhaps without the shortcomings of the old nationalised set up?

And don’t forget the real reason many of the utilities were privatised in the first place. It was to bail us out of a previous recession, but of course once the family silver is sold it’s sold.

Member

Good point, Malcolm. I have previously suggested that issues as important as this should have all-party support because I don’t believe that this government or the opposition can be trusted.

I fear that your suggestion could deliver little in the next decade but cost a lot to run.

Someone should ask what industry and government pay for energy, and if this information is not forthcoming a Freedom of Information request could be made.

Member

If you buy energy over the internet, have duel fuel and pay by direct debit it makes very little difference which of the big six you take your supply from.
Yes there are modest savings to be made if you time it right (between price increases) and get a one or two year fix but over say five years switching is certainly not the panacea to low cost some would have us believe.
The multitude of tariffs with different standing charge and carefully places unit price changes are only there to try to delude us.
Just wait, when the number of tariffs is reduced by law see how close prices really are?

Re-nationalise, the only way to stem excessive profit and stop this marketing cat and mouse game. And stop the fat cat shareholders profiting at the expense of the old and poor.