An advert from British Gas offering customers free gas for a year has been banned by the Advertising Standards Authority (ASA).
The advert send out from the company offered free gas for a year in exchange for a new boiler, but a complaint was received after a customer challenged the advert as misleading.
The complainant said his redemption cheque was only 73 per cent of his gas costs, and the advert was misleading as to how the 'deal' actually worked.
In response British Gas said it "believed the mailing made clear how the customer's gas payment would be calculated."
The energy provider defended itself by stating the refund was based on the prices at the time of the offer and did not cover the price rises of 15 per cent in January 2008 and again by 35 per cent in July 2008.
British Gas claimed "the mailing made clear that the gas payment would be made according to the 'amount of gas used' not the actual price paid".
However, the ASA found in favour of the claimant and prohibited the use of the advert in its current form saying it was "likely to mislead". They said it breached CAP Code clauses 3.1 (Substantiation), 7.1 (Truthfulness) and 27.4 (Unnecessary disappointment).
Last year, British Gas was in trouble for false advertising over the word 'free' due to a TV advert about boiler repair. The ASA also found that advert to be misleading with British Gas being told "not to describe the repairs under HomeCare as "free" in future".
The ad banned today stated: "Free gas for a year. Free gas for a year. (Yes, you read it right the first time.) Buy a new boiler now and enjoy up to £800 free gas LAST CHANCE! OFFER MUST END 24TH NOV! Buy a new boiler now and enjoy a year's free gas.
"If we already supply your gas: We'll take a metre reading straight after installation. You pay your gas bills as normal and, after 12 months, we'll ask you to take another reading. After you've provided your second reading, we'll pay you for the amount of gas you've used, up to £800.
"Or, if you prefer, you can simply take £305.81 off the cost of the boiler upfront, which is the amount of the industry average gas bill with the 40 per cent saving from a new boiler."
Small print on the third page of the mailing, which was linked to text in the body, stated: "This will be calculated on our monthly direct debit gas prices at August 2007 including VAT at five per cent.
"Amount calculated on an annual gas bill (inc. VAT) for monthly Direct Debit customers, based on industry average annual consumption of 20,500 KWH at British Gas unit rates as at August 2007."