Ofgem has decided to maintain the ban on acquisition-only tariffs (BAT) to ensure all customers can access the best deals available.
Acquisition-only tariffs are discounted rates available exclusively to new customers.
This decision follows a consultation in May where consumer groups and most suppliers supported keeping the ban to prevent unfair treatment of existing customers and avoid the “loyalty penalty.”
A few days ago, a coalition, including Which?, E.ON, Octopus, So Energy, Rebel Energy, the End Fuel Poverty Coalition, Citizens Advice and Fair by Design, expressed concerns about the impact on existing customers, who could face higher costs if they are unable to access competitive deals typically offered to new customers or those who switch suppliers.
The consultation highlighted concerns that removing the ban could lead to an unfair market, particularly for customers in debt who cannot switch suppliers.
The BAT was introduced in April 2022 during the energy crisis to provide stability and prevent short-term discounted tariffs from creating market imbalances.
Although Ofgem considered ending the ban to offer more choices for switching customers, the feedback from the consultation led to the decision to extend it until at least 31st March 2025.
Ofgem will continue to review the impact of the BAT and its role in the future energy market, with findings to be reported in due course.
Charlotte Friel, Ofgem’s interim director for consumer protection and retail markets, said: “Whilst competition is an important part in driving better standards, so too is consumer trust – and it is clear that denying the best deals to all risks undermining the progress we have made to restore confidence in the energy market.
“Customers have the right to vote with their feet and switch suppliers for better service, or more support, but retaining the BAT will mean that they don’t have to keep moving to chase the best rate.”
