You are here

Why Choose a Small Energy Supplier: Cheap, Reliable, Better

Independent energy suppliers

Britain has always been proud of celebrating homegrown talent. Whether it be sport, innovation or personalities, Britain consistently shows their support, particularly for the underdogs. Now, the nation is switching away from the larger, ‘Big Six’ energy companies and signing up with the smaller, independent suppliers to provide their energy. On this page we lay out some facts and figures as to why so many are changing.

Who are they?

Currently there are over 40 independent energy suppliers in the UK.

Year on year new energy suppliers are joining the market to compete against the big 6 suppliers who have had an overwhelming amount of the market share, until now.

The smaller companies are growing rapidly in a market that is highly competitive.

First Utility is now the largest independent company in the UK with 1 million customers. With only 50,000 customers in 2008-2011, between 2012-2015 they acquired 475,000 customers, an increase of 85%.

Now, in 2017, independant companies own more than 13.5% of the market share in the UK and between 2011-2016, 7.1 million people switched away from the big 6 to an independent supplier.

It's not me, it's you.In 2015, 40% of switches were made to independent companies.

Why are they cheaper?

In an act to make the energy market more competitive, the government made the smaller independent companies exempt from the energy company obligation (ECO).

Through not paying this charge (that the big six suppliers do) it gives the independent suppliers a chance to compete and reduce their rates.

These savings have been passed on down the line, right into your pocket, meaning you can benefit directly from these cheap rates.

Smaller energy suppliers, such as First Utility, for example, are not held under the tight restrictions of their conglomerate companies like the big six.

As such, they have much more free reign on profit margins, energy sourcing and other price-affecting factors.

Pound coins

Save money on your energy bill choosing an independent energy supplier.

This is why you’ll find that most independents source 100% of their energy from renewable sources, because they don’t have the pressure of having to generate it themselves.

As many big six companies have always relied on their customer loyalty, allowing them to inflate their prices as much as they want, a higher-than-average price normality has been established across the market.

Now that there are a few more players in the game, however, this over-inflated price structure has been challenged.

A much fairer cost per unit has been implemented, meaning you’re no longer paying for a brand that holds zero unique selling point.


  • The Independent companies are growing in the UK
  • 1/100 homes were powered by independent companies in 2011 (140,500)
  • 1/6 homes are now powered by independent companies in 2016 (3.1 million)

Why would I choose an independent?

Apart from saving money? Well, there are many reasons to switch to an independent and a high customer service score should be one of them.

Which? have consistently rated independent energy companies above any of the big six suppliers.

In Which?’s latest customer survey, independent suppliers cover the top 13 best rated customer service in the country.

The closest big six company is e:on at number 14 with 57% and Npower with the lowest score of 44%.

A supplier with a high customer service rating can be an attractive quality to look for.

We all know the nightmare phone calls that have to be made when we want to switch our phone tariffs or fix our boilers.

They’re painful, but can be avoided. Not all customer service departments are outsourced and difficult to deal with.

Scoping out a company that has quality reviews is something that is often overlooked, but many independent suppliers have trained their staff effectively and customers are experiencing the benefit.

With all of the new energy suppliers (mostly) been born in the 21st century, their business plans are refreshing compared to the bigger companies’ ‘corporate’ business plans, where some might think they are outdated.

The new suppliers on the market offer unconfusing bills, smarter tariffs and are easily contactable online or via telephone, providing a more modern way to handle your energy.

The big six companies lost 660,000 customers in 2015 and Ofgem expect the big 6 may lose even more, potentially up to a quarter of their customers by 2020.


Conclusion

The evidence is in plain sight, independents are doing a better job in all areas than their bigger rivals, ‘The Big Six’.

When looking to switch or get a new energy supplier, the price of the tariff and customer service should be the first two things you look for.

If the Big Six companies are at the top of that list, great. If not, don’t let the name put you of opting for an independent.

Many of those customers that once held their allegiances to the big six so tightly are now slowly dwindling and switching to the better and cheaper independent companies.

If you are a customer of any of the big six and did not know you can get a better deal elsewhere, now is the time to search for a new deal. Search for a great deal right here with Selectra.

  • Independents have better customer service on average
  • Your supply will not be any different
  • Prices are much cheaper on average
  • Independents typically supply more renewable energy as part of their tariffs


Benjamin


This article was written by Benjamin. From Portsmouth, but having spent 7 years in Switzerland, he joined Selectra in August 2017 and is responsible for writing expert content about the UK gas and electricity markets.