Note: This advice is given by the CAP Executive about non-broadcast advertising. It does not constitute legal advice. It does not bind CAP, CAP advisory panels or the Advertising Standards Authority.
Following the deregulation of the gas and electricity industry, the ASA upheld many complaints against utilities marketers who had made misleading price statements or price comparisons. In response to this, CAP consulted the industry and in November 1998 issued a Help Note on Price Claims in Utilities Advertising. An updated version of the Help Note was issued in November 2000; it contained no major changes but reflected ASA decisions since the launch of the original and offered more comprehensive advice to marketers.
Key points covered by the Help Note include:
1. General savings claims - these should not exaggerate the availability or extent of benefits likely to be attained by consumers. Claims should be qualified, where necessary, to refer to the conditions that affect it. A claim that states or implies that all consumers will save is unlikely to be acceptable if any do not, even if a qualification to that effect is made elsewhere in the marketing. The claim should be amended either to reflect the condition(s) that applies to it or to remove the implication that all consumers will save by making the claim conditional (ScottishPower Energy Retail Ltd, 16 June 2010). The Help Note also gives guidance on the prominence of qualifying claims and discusses the use of consumption figures (see Section 1 of the Help Note);
2. Savings against a competitor's prices - comparisons should not mislead or be likely to mislead (Viridian Energy Supply Ltd t/a Energia, 2 June 2010). Marketers making tariff comparisons should assume that customers act rationally when selecting the best service available to them. When comparing, they should compare their tariff with their competitor's equivalent or most similar tariff; normally based on frequency of payment, payment method, dual fuel discount where applicable and tariff ''bands''. It is acceptable to compare dissimilar tariffs only if it is stated prominently that the competitor offers a tariff cheaper than that featured (see Section 3);
3. Dual fuel offers - marketers who offer savings to customers dependent on the supply of more than one type of fuel should clarify this prominently; they should not imply that customers taking only one type of fuel can benefit from those savings when that is not true (see Section 4); and
4. Regional/local suppliers - if marketers refer to either themselves or their competitors as the regional/local/existing supplier, they should supply a reasonable proportion of consumers at whom the marketing is directed (see Section 7).