Price comparison websites push up the cost of energy bills because of the commission charged to suppliers, the head of Co-operative Energy has claimed.
Co-operative Energy group general manager Ramsay Dunning suggested that money spent on comparison websites could otherwise be going towards reducing consumers’ bills.
He said: “A lot of money goes on advertising of the comparison websites, and that goes through to the commissions that energy companies such as ourselves and all the others have paid to the comparison websites.
“And if that money wasn’t going on TV advertising, on radio advertising, on national newspaper advertising ... it could go to reducing bills.”
Price comparison website uSwitch hit back in a statement, saying that such websites have been doing “all we can to champion small suppliers and to help consumers in the face of higher energy prices”.
uSwitch said more than 90 per cent of its visitors simply gather information and advice rather than going on to switch.
Its statement continued: “We are upfront and open about the fact that this is paid for by fees we receive from suppliers when somebody switches – we receive no other funding.
“The commission we receive also pays for our call centre so that we can help those who aren’t online. The important thing is that we will always show somebody the cheapest deal for their needs regardless of whether we have a commercial agreement in place with that supplier or not.
“To suggest that we are helping to push up the cost of energy is simply ridiculous.”
The debate over rising energy prices has become increasingly politically charged in the past year, with bosses of the Big Six suppliers having been called by MPs to account for their prices and policies.
Rising wholesale costs and environmental “stealth taxes” were to blame for the controversial hikes announced last autumn, the Energy and Climate Change Committee was told.
Further anger was sparked this week when energy giant SSE said it was on course to pump up profits to £1.54bn this year and increase payouts to shareholders, two months after announcing a sharp hike in customer tariffs.
SSE, which trades as Southern Electric, Swalec and Scottish Hydro, raised tariffs by an average of 8.2 per cent from November, blaming Government green levies as well as rising network costs and wholesale energy prices.
A spokesman for Ofgem said: “Price comparison sites play an important role in helping energy consumers compare deals.
“Ofgem has taken over the running of the code of practice for such sites and we are reviewing it to ensure that its objectives are in line with our reforms for a simpler, clearer, fairer energy market.”
The spokesman said the code of practice was there to protect consumers in a number of ways.
He said: “For example, switching sites have to state which suppliers they earn commission from.
“They also have to make sure that they do not rank tariffs in accordance with the suppliers from which they are earning commission.”
Earlier this week, energy giant Npower claimed bills in the UK were high because the country’s “old and draughty” houses waste so much gas and electricity.Audrey Gallacher, director of energy at Consumer Futures, said: “There’s a big issue about how sites are regulated and more importantly their transparency on commission costs. Consumers deserve to know that.”