Only one in four tenant are switching energy suppliers when they move into a rented home, even though they could save money.
Energy watchdog Ofgem reckons tenants could save around £190 a year by changing their gas and electricity suppliers.
The watchdog is warning landlords and letting agents that they cannot stop tenants switching energy suppliers if they pay the bills direct – even if the tenancy agreement says they can’t.
To help landlords and tenants understand their rights, Ofgem has published a booklet.
Ofgem explains that if letting agents and landlords include clauses in tenancy agreements forbidding tenants to switch suppliers, they are breaking the law.
Some landlords charge tenants an exit fee for moving suppliers, which is also illegal.
The only circumstance that stops tenants switching suppliers is if they pay their energy bills with the rent to landlords and letting agents.
“The key energy right is that where a tenant is directly responsible for paying the energy bill they have the right to choose their own energy supplier. The landlord or letting agent should not prevent this,” said Ofgem.
Philip Cullum, Ofgem’s Partner, Consumer Policy and Demand Side Insight said: “At a time when 9 million homess are renting and budgets are tight, it is important that consumers are clear about where they stand when choosing and switching their energy supplier.
“Our research shows that tenants that have not switched could save an average of around £190 on their annual energy bill. Ofgem’s clear guide and top tips are intended to empower consumers when navigating the energy market and help them to find their best energy deal. It is all part of Ofgem’s work to make the market simpler, clearer and fairer for consumers.”
The publication is part of an ongoing Ofgem campaign to explain how the energy market works to consumers.