The new rules will come into force from October.

White labels are organisations that do not hold supply licences, but instead work in partnership with licensed suppliers to offer gas and electricity using their own brands. Sainsbury’s Energy using British Gas’ supplies is an example of such an arrangement.

Under existing Ofgem regulations, suppliers are already compelled to inform customers about their cheapest deal – however, until now, this rule hasn’t extended to white label tariffs.

Under Ofgem’s new rules, white label brands will have the same flexibility as their partner suppliers in areas such as the number of tariffs and types of bundles they can offer. Ofgem believes this will make it easier for new companies to enter the energy market.

“Selling energy through white label brands has the potential to increase consumer choice and engage consumers to shop around,” said Rachel Fletcher, senior partner at Ofgem.

“But, it is important that consumers are given the complete picture about all their supplier’s tariffs. We are acting to reduce barriers to white labels entering the market, and to ensure suppliers tell their customers what the cheapest deal is for them. Transparency is important in rebuilding consumer trust in the market.”

The announcement provoked positive reaction from some commentators. Matt Ridout of energyhelpline.com said that any move which raised consumer awareness of the cheapest deals available was positive.

“However, to get a full picture of the cheapest deals from all suppliers consumers still need to shop the market. Often a better tariff can be found with another energy company. A whole of market price comparison provides a quick and easy way to see who is offering the best deals.”

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