The energy regulator has urged consumers to switch energy supplier following the news that British Gas intends to increase residential gas prices by as much as 25 per cent in the coming weeks.

In a move many observers will view as criticism of British Gas, Ofgem said that customers who have never switched supplier could save around £100 by doing so.

"Higher energy prices mean getting the best deal for your energy has never been so important," Alistair Buchanan, the chief executive of Ofgem, said. "Our message to customers is to be energy smart and take advantage of the strong competition in the energy market to get yourself a better deal.

"There are savings of around £100 a year and suppliers are also competing for your business by offering fixed-price and internet deals," he added.

Yesterday, Age Concern described British Gas’s potential 25 per cent price rise as "shocking", "unjustified" and "excessive" and called on Ofgem to investigate whether the move was legitimate.

But today the regulator refused to explicitly condemn the energy giant, saying it was not in its remit to investigate price rises if they were caused by market forces.

"At the moment, domestic customers in this country have the lowest gas prices in Europe," an Ofgem spokesman said. The regulator also insisted that the energy market is competitive and pointed out that British Gas continues to lose market share.

"British Gas lost six per cent market share between June 2004 and June 2006," Ofgem said, adding that company now has "only" 53 per cent of the market.

Paul Kenny, acting general secretary of the GMB union, criticised Ofcom and called for the Government to "get a grip" over the energy market.

"The GMB have long warned that the lack of central planning and control in the energy market would leave the British consumer totally at the mercy of global forces.

"We have argued that energy is too important to be regulated by a quango. The Government itself must be the regulator and be accountable to Parliament for that role.

Adam Scorer, the campaigns director of energywatch, called on British Gas’s 11 million customers to abandon the company should it implement the price rise.

"Should a major supplier, British Gas or anybody else, raise prices by 25 per cent, we would expect consumers to respond angrily, by leaving for a better deal," he said.

"Such a rise would be unprecedented since the start of competition," he added.

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