45 Thousand Britons switch energy supplier in Jan
Hundreds of thousands of customers switched to a new energy supplier in January according to new figures, are you missing out? Selectra brings you the details.
How many people changed energy providers in January?
Switching energy companies has never been easier or quicker and Energy UK, the trade association for the energy industry, has revealed that 446,750 households took advantage of the opportunity to change their provider in the first month of 2020.
The increase follows last year’s record number of people changing where they get their gas and electricity from, when 6.4 million made the switch, the highest recorded since 2003.
The number moving to a new energy supplier in January 2020, which includes both domestic and non-domestic customers, shows a rise of 17% on the 382,665 who switched in the same month in 2019.
Energy UK’s interim chief executive Audrey Gallacher said January has “traditionally been a slow month for switching.”
“So a figure of nearly 450,000 customers shows that momentum is continuing following a record 2019,” she said.
“On average, there were 12 switches every minute last year and it’s encouraging to see more and more customers getting in the habit of saving money by looking for the best deals available from nearly 60 suppliers on the market – not forgetting the many more on top of these figures who have moved to different tariffs with their existing supplier."
Which type of energy suppliers are more people switching to?
While 72,862 moved from small and medium-sized providers to larger firms, 154,707 customers changed from a bigger supplier to smaller or medium-sized ones.
Out of the total number of switches in January, 35% were made from larger to smaller suppliers, while just 16% moved from a smaller company to a bigger one. People moving from one large supplier to another accounted for 26% and 23% moved between smaller suppliers.
Overall, small and medium-sized energy utilities made a net gain of 81,845.
This net gain figure is calculated by subtracting the number of switches from small and medium-sized firms to larger ones from the total number of switches from larger to smaller and mid-tier suppliers, meaning 18% of all switches were a move away from larger companies.
This follows the strong trend seen over the last few years of the majority of switches being made to smaller suppliers.
What do small energy suppliers offer customers?
According to the latest available figures from energy regulator Ofgem there are 61 gas and electricity suppliers active in the UK market. That number is made up of the Big Six largest suppliers and 55 others.
The Big Six and some other large firms have enjoyed a comfortable position for a long time.
As household names, they often rely on brand recognition and marketing to attract new business.
Many of their existing customers have been with them for years and may stick with them out of a lack of awareness that better service from an energy company is possible or of just how much they could save by going elsewhere.
The average single variable tariff from the Big Six for a typical dual fuel customer paying by direct debit was £1,178 as of 28 January 2020, the same as December.
This is just £1 less than the default tariff cap of £1,179 that Ofgem introduced to limit the exploitation of customers by big companies.
It doesn’t take a cynic to suggest giving their customers a good price isn’t a priority for these energy giants.
Compare that to the cheapest tariff basket from the ten cheapest suppliers, £840.52 as of December 2019, £31.82 lower than the November price.
The difference between the cheapest tariff basket on the market and the average single variable tariff from the Big Six has gone up from £305 to £337.
As prices among energy suppliers are constantly changing it’s not worth staying with the same provider for more than a year, there’s usually a better deal to be found elsewhere by the time your contract is up.
In terms of making savings on your energy, the data couldn’t be clearer -small is beautiful.
Is changing energy suppliers difficult?
Customers who have never switched might think the process to change suppliers must be lengthy, complicated or expensive, all of which are far from the truth.
Switching should also be a straightforward and speedy process.
Once your new supplier has your details they have 15 working days to carry out the changeover and you won’t notice any difference in your energy supply in the meantime.
Ofgem keeps a sharp eye on how companies handle the switching process and has introduced automatic compensation for the small minority of customers who don’t get moved over smoothly within the agreed time frame.