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How much are the 'Big Six' costing you?


What's the deal?

In the UK we like to believe that loyalty goes a long way. The more time you stick around, the more rewards you’re likely to receive, right? It would appear that this most certainly is not the case for the majority of UK energy consumption, and if you’re reading this, there is an 85% chance you’re included in this statistic. The so-called ‘Big Six’ energy companies, comprised of British Gas, EDF Energy, E-ON, NPower, Scottish Power and SSE, currently hold around an 85% oligopoly on the UK energy market, leaving just 15% of homeowners opting for the mountain of other energy companies currently operating in the UK. One would perhaps assume that this statistic cries out qualitative superiority in favour of the ‘Big Six’; however, perhaps the most important focus area for us britons, cost, is largely uncompetitive in relation to many of the other companies out there. It seems that based on the plethora of existing case studies built around this subject, a large number of people who have taken the plunge and changed energy providers are saving hundreds of pounds per year. So, why aren’t more people being more intelligent about their choice of energy supplier?


Lack in customer service

Although the popularity of companies outside of the Big Six has increased over recent years, a huge 85% is still controlled by those companies within it. Despite the sea of complaints regarding the increasing profit margins of companies within the Big Six, according to a report made by 5 News, during the year of 2014, encompassing the huge winter rise, the average household energy bill only fell by a mere 4%, as opposed to the large drops of up to 30% in energy’s wholesale price. Although independent companies outside of this bracket have proven that money and effort can be saved whilst maintaining a high customer satisfaction rating, UK homeowners are still reluctant to change their energy supplier. Many put this down to familiarity, whilst others are sceptical that they will indeed acquire the level of savings advertised. Changing energy supplier, however, does not necessarily force the necessity of leaving one’s comfort zone; changing supplier within the Big Six is also one way that people can save money. The ‘new customer offer’ is a growing trend not only used by energy companies, but in industries such as gambling, education, mobile phones and many more. It can often be a smart way for people to take advantage of the generous offers supplied for new customers. In an age where loyalty is diminishing in meaning and potency, a new approach to consumerism is perhaps required to hold on to a bit more of your pay cheque each month.


Price disparity

From a short web search, one can discover just how great the price disparity is between energy companies in the UK today. Let’s say, for example, you are interested in a gas and electricity tariff that would cater for a 3 bedroom house in Yorkshire, in which you and your partner live with your 2 children. On the estimate that you consume a generous 5000 kWh of electricity per year and 14,000 kWh of gas we are able to compare your pricing structure on a variety of energy suppliers. For our two companies, we shall use the most popular supplier in the UK, ‘British Gas’ and the #1 ranked provider on Trustpilot, ‘Bulb’. For the standard tariff available from British Gas, according to the aforementioned predictions, your annual gas and electric combined bill would be around £1307. Over at Bulb however, your combined bill would be a much improved £1,051, a simple saving of £256. So what is represented in that rather large price difference? What would you, along with the other millions of British Gas supplied homes gain from using their more expensive service? The plain and simple answer is ‘not much’. The over-inflated pricing structure implemented by the Big Six companies, in this case, British Gas, is nothing more than reliance on customer ‘loyalty’. This pricing disparity exists because companies such as ‘Bulb’ do not have the existing client base in place to exploit.

Bear in mindIt is worthwhile noting that because of the structural grandeur of the larger companies, a larger effort can be made on customer service and experience. Although this is not always the case, it is definitely something to bare in mind when choosing your energy provider.


Focus Points

We have all had nightmare experiences when dealing with customer service representatives. Whether it be in reference to your mobile phone, gas and electric, insurance or cable television service, problems frequently occur whilst attempting to resolve your issue: maybe the operator is not a native speaker of your language; or perhaps they simply do not have enough knowledge of their job. It’s regularly a deal-breaker. However, by the time you’ve reached this point, it’s usually too late to simply leave. Customer service is rapidly becoming a vital requirement for consumers worldwide, which begs the question ‘which would I prefer: losing out on a couple of hundred pound or a recurring date with the call centre from hell?’. Focus should definitely be placed on your overall experience with the company that you are about to choose. Perhaps a more locally grounded company may suit your needs more adequately than one of a corporate structure, that way, you can be more confident that you will be understood when communicating with the company’s representatives. On the other hand, maybe you have researched into one of the big six companies and heard fantastic things about one of their customer service departments. Bigger companies, with bigger budgets, can often afford to invest in quality, which, given a little research, you may be able to find. Each point made on this page should act as a little trigger to aid you in this process of both saving money and finding a company more suitable to your requirements. But perhaps the biggest message portrayed here is ‘do not be afraid to change your provider’.


Summary

  1. Don't be afraid to be part of the 15% of Britons that have moved onto a cheaper, independent deal.
  2. Think about the customer service that you will recieve with each company.
  3. Make sure the price is competitive and reflective of the service you are being provided.
  4. Do not sacrifice quality customer service in favour of a slightly cheaper price.
  5. Don't hesitate to give Selectra a call on 01704 325056. We'll help you through this process with efficiency and simplicity.