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Why aren’t we all switched on to energy switching?

A light switch on an orange wall

We’ve found that energy prices are the biggest worry for consumers. But if so many of us are worried about how much we’re paying for our gas and electricity, why aren’t more of us switching suppliers?

Our latest consumer tracker data has found that more than eight in 10 people are worried about energy prices, making energy the top consumer worry above fuel and food costs.

Last weekend we published research testing Ofgem’s proposed system for comparing energy tariffs against our ideal system using a single unit price. As well as asking energy customers to compare the two systems, we also asked them about their attitude to energy bills and switching.

So many of us could save money by switching to a different energy supplier or tariff. But more than half of the people we spoke to have never compared their tariffs with others on the market to check if it was worth switching. Only a quarter of people had switched supplier in the last two years.

Most concerning of all – almost six in 10 could not even find their energy bill to see what tariff they were on.

Finding the energy to switch

Do you know where your latest gas or electricity bill is? If not, perhaps you’re one of the people who simply aren’t interested in the price they pay for energy. You receive your bill, pay what you owe and get on with your day.

I’d been putting off switching my energy supplier, because I expected the process to be a huge hassle. Mainly because my flat is rented and I knew I’d have to check with the landlord before making any changes. In the end, my landlord was fine with me switching and the whole process is due to be completed by early next week. I couldn’t believe how straight forward it was.

Switching suppliers to make substantial savings

Of course, switching doesn’t always go smoothly and we are often told about meter mix-ups and final bill disputes by disgruntled energy customers. But I think in most cases it is definitely worth the effort, especially if you stand to save money on your bills.

Of the quarter of people who switched supplier in the last two years, seven in 10 of them did so to save money with a cheaper deal. If you are on a standard energy tariff and haven’t switched for a long time (or even never at all), you could save upwards of £200 on your annual bill.

I don’t know about you, but I think that £200 for half an hour’s work is a pretty good deal.

Do you know where your most recent energy bill is?

I have paperless billing (52%, 125 Votes)

Yes (44%, 107 Votes)

No (4%, 10 Votes)

Total Voters: 242

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Most of us are aware of the potential benefits of shopping around but the downside can be that savings may not last for long. An example is enticing interest rates for savings. Some take a pride in keeping a track on prices and have spreadsheets and diaries keeping track of everything. What most people would be happy with is reasonable prices that will remain so for a decent length of time.

I have switched energy supplier only twice, the first time mainly to buy electricity and gas from the same supplier and to manage my account online. That proved very easy, but I was disappointed that I was still routinely pestered by meter readers and their ‘sorry you were out’ cards despite providing meter readings promptly on request. The second time I switched, which was fairly recently, was not straightforward. Scottish Power made mistakes and caused confusion. I was pestered by e.on, the previous supplier, and eventually phoned to say that if they pestered me one more time they would be boycotted and I would not consider them next time I review where to buy energy from.

Please carry on with pushing for suppliers to offer a single unit price.

Like a real Mug, I tried to get the best tariff from Scottish Power who supply me. I “found” a nice cheap one and went through the procedure to get a quote – and found I’d been transferred from standard @ £45.00 per month (another 5 or 6 months) to an Internet saver tariff @ £55.00 per month!!! I was NOT allowed to revert to my current tariff but had to remain with this DD Tariff or leave after forfeiting a Departure Payment. This is how SP treat Pensioners. God help the rest!!

Tell them you are going to complain to Ofgem and tell Ofgem that you made a genuine mistake when trying to get a better price. Make it as hard as possible for Scottish Power. They have treated you disgracefully. Nobody would intentionally select a more expensive tariff. So much for the energy companies offering us the best deal.

I check my best deal through Switch with Which whenever my supplier changes my tariff – using my annual consumption in kWh. Checking is straighforward and examining the options, rates and terms is equally easy. I’ve switched a couple of times and that was equally straighforward. I suspect like you many people think it will be difficult, or just can’t be bothered.
I do keep check on the supplier and they (NPower) have written to advise their rates are increasing by just under 10% for my current deal (online Jan 14) in July; checking their website for alternative tariffs I found “online Aug 14” would only cost 5% more (checking with Switch again I found this was still my best deal). So I’ve emailed Npower asking them to change to this instead and also asked why it wasn’t offered as Ofgem will be making it compulsory to offer the cheapest deal. NPower have been very good at responding in the past – see what happens this time.

A prompt response from NPower changing me to the better tariff. However, regarding offering the cheapest deal, they replied:
“In regards to offering you the best tariff, Ofgem regulations specify that we must do this when asked. We ask you to get in touch or check online to see what would be the best tariff for you and will happily offer you the best one when asked on the phone or online.”

This may be current Ofgem requirement (?) but the new Ofgem proposal is:
“3.66. Our proposals require the cheapest tariff messages to be provided in the following communications: Bills, Annual Statements, Price Increase Notifications and End of Fixed Term Notices”. So to be provided automatically, not when asked.

This, of course, only applies to your current provided. Finding your best deal in the whole market will require research – best done, I suggest, by using a switching site such as Switch with Which which will do all the work for you (just keep a record of your annual energy usage in kWh from your bills).

I am glad to hear that you are pushing npower to comply with the rules, Malcolm. I wonder what action will be taken if suppliers fail to provide information about cheapest tariff to customers.

Today I celebrate the completion of my switch from e.on to Scottish Power, but only because I made a call to ask about the login details that were promised ‘soon’ on 29 April. I have been given confusing, conflicting information twice and the process has only taken three months since I received a welcome email from SP.

wavechange, the enforcement proposed can be found around P114 of the Ofgem document. An extract is (SOC = Standard of Conduct):
“The Retail Market Review – Final domestic proposals
4.23. The proposed licence condition for the SOC includes a customer objective that a supplier (and their representative), must treat consumers fairly. A supplier would only be in breach of the SOC if their actions or omissions significantly favour the interest of the licensee and also give rise to the likelihood of consumer detriment.
Approach to enforcement
4.24. As the proposed new SOC will be given effect through a licence condition, it will be enforced by the Authority. We will take a proportionate approach to investigating issues in line with the criteria set out in chapter 3 of our Enforcement Guidelines.247 As noted in our October 2012 consultation document, we are introducing a bespoke policy approach to enforcement specifically to apply to the SOC.”
Presumably if sufficient complaints are made about a supplier then Ofgem would spring into action. As Which is so involved with the energy issue it might be useful if they acted as a centre for complaints?

Thanks Malcolm.

I read that “suppliers must behave and carry out any actions in a fair, honest, transparent, appropriate and professional manner”. e.on used to keep my account well in credit and a discussion with Scottish Power indicated that they would probably do the same. If necessary I will instruct them to desist and quote the Ofgem document.

I certainly do not support re-nationalisation but our energy companies need to be kept in order.

I waited a long time before I switched, when I did, it went really smoothly. I used Which? and MSE or Money Supermarket to switch. I compared prices on both sites, found a very good EDF Blue fixed price tarriff and by using the non Which? site to switch, I got a £30 cash refund for using their site. Despite it being easy to switch to another provider, I would not wish to do it every year, so will be looking for fixed price up to two year contract in the future. It was only after I received the first bill following my meter reading, that I relaxed.

Why have I switched ISP, phone, insurances, Bank etc. but waited until early this year before changing energy suppliers for the first time. There is no logic in why I waited so long.

I don’t think that Which are going to win their battle for a single unit price, nor do I happen to think it is realistic in simplifying what will always remain a market with choices. So would not Which’s best move be to accept this and to work on the best ways to make use of the latest proposals in helping consumers to get their cheapest annual deal? I simply want to pay the least possible for my energy.
I would also like to see a balanced argument set out for the different tariffs proposed – nowhere, for example, have I seen an explanation of why Ofgem include standing charge tariffs in the options (which also include no standing charge options). The issue is not black and white, so perhaps all the facts would be useful in future? We may still disagree with the principles, but at least understand the thinking behind them and be able to comment on them.
They are also a little sensationalist in looking at numbers – consumers may overpay by £55 million pounds, but let’s not overhype the issue – over 3.4m customers that is 30p a week (perhaps that’s underhyping). It still should be pursued, but don’t overcook it.
I’ll sit back now – just adding a bit of fuel to the fire.

bob says:
8 June 2013

According to the Which article above:
* Most people worry about energy price
* Most people don’t seek lower energy prices
Either something is wrong with customers, or something is wrong with the market.

We can change customers through awareness campaigns – everybody here should persuade & help family and friends to look for lower prices.

We can change the market by holding suppliers accountable for the rate of switching. More radically, we could make buying domestic energy more like buying petrol. Petrol is prepay and you can buy it from any supplier at any time. Nobody would dream of a 12 month lock-in for petrol. Prepay domestic energy locks you in to a single supplier.

In my opinion, I think that energy suppliers need to say what will happen during the switching process in simple terms or people won’t do it.

Say for example that you’re account is not in credit becuase you pay on a monthly DD a fixed price. It’s not clear whether that debt will be inherited by your new supplier or not.

People assume it isn’t, or they assume that the DD will occur on a different day or something like that, and they can’t afford to cover that, so they stay put.

The same assumptions are made about switching bank accounts and overdraft inheritence.

I’m comfortable that I’m of a good deal generally,as I fixed it before the last price hike.

I think I could call myself a “serial switcher”. I have tried 5 of the big 6 cartel which over time seem to be much of a muchness with little if any real difference in price, and all exhibit intermittently poor customer service.
Once you’ve got onto the monthly direct debit payment method and unravelled the multiple tariff, variable standing charge marketing rip off you’ve got things as good as they are going to get. Whoever you buy from prices are still exorbitantly high and ever increasing at well above the normal inflation rate.

I’m surprised so many still believe this privately owned free market approach offers any real competition, and also believe that switching from supplier to supplier is some universal panacea to low prices. In my experience over several years it’s not.

This constant bombardment of advice we get to “switch and save” is tinkering around the edges of a very broken supply system. Even “Which” go on about switching every ten minutes, and should know better. Once you’ve moved off the standard tariff things don’t get much better whoever you go with.

To my mind the answer to control of a part of national infrastructure is to re-nationalise with the brief of the top man to meet targeted price reductions on an ongoing basis. I’d happily pay him big bonuses for real success.
As a backup I’d also form an independent overseeing body to see that targets are achieved with the powers to replace top management if they fail.

Better than a shareholder owned approach where the only objective is to make ever increasing profit through confusion tactics thought up by clever marketing departments.
That’s what we have now.
That’s the minefield we have to navigate through just to stay warm in the Winter at anything like affordable prices.

We need a major game change.
We need to attack the disease rather than trying (and failing) to treat the symptoms with the magic pill of switching, which it’s not.

Sure Save says:
14 June 2013

It’s ridiculous how many people haven’t switched. Most comparison sites just require your annual usage, which you can get from your energy supplier with one phone call.

I went from Scottish Power to British gas. It took five mins and the only thing I had to do after I’d been online was to let British Gas in to do a new reading.

Now my electricity is cheaper and I got a couple of nice extras for doing so too!

It was just so easy. I don’t understand why more people don’t do it.

It’s even easier than shopping around for a new payg mobile phone because there are so many good energy comparison sites out there to use.

Brian Wilki says:
17 June 2013

I searched in June last year and switched to First Utility’s ‘I SAVE DV 10’. In February they imposed upon me a change to their ‘I SAVE EVERYDAY DFD’

I now discover that of their many tariffs, they had imposed upon me their very most expensive tariff. I would have suffered a severe penalty should I have changed within the first year and find this kind of conduct simply dishonest.

Well done ‘Which’ for highlighting these organisations.

Brian, I met the same issue in effect – my contract unit prices were increased but I wasn’t told of a cheaper tariff by my provider. Ofgem’s proposal means that, in future, your energy provider will have to advise you automatically of their cheapest tariff when any change to your terms takes place. However, that is the time to check on a Switch site that you have the best deal.
If your tariff changed then you should not be penalised for making a change, and certainly not with the same provider. I suggest you take this up with them.

Malcolm is right.

I think it was NFH that provided a link to the Ofgem document, but a search for ‘The Retail Market Review – Final domestic proposals’ will find it.

Alwyn says:
20 June 2013

I think everyone should be a serial switcher and switch at least once a year of they have to.

It’s true that companies save their best tariffs for new customers and there must be loads of people out there who have been on the same dead tariff for years.

So the best way to stay ahead of the game is to switch as often as possible, preferable to a tariff with no exit fees.

I switched my electricity from Scottish Power to British Gas (using yoursuresave.com, one of the smaller sites) and noticed a big difference just on my electricity alone and although you do hear some horror stories it all went smoothly.

I must admit, it’s a bit of a puzzle why more people aren’t switching, I know about 3 or 4 or my friends who have done but not many altogether.

Sharon says:
26 June 2013

I’m just becoming a serial switcher having joined in the Big Switch last year or whatever it was called, my tariff runs out at the end of July. The Co-op are no longer the cheapest for me and although there’s no-one who can match my current tariff, Sainsbury’s are the most competitive of the new tariffs.

However, the issue I’m now coming up against is timing the switch. It seems I’m unable to determine the date of the switch and so have to time it so it’s after my current tariff runs out or I will be slapped with charges for leaving the fixed tariff early. The Co-op will not allow me to put a date on the account before which it can’t be switched and the USwitch website I’m using to move over to Sainsbury’s have told me it can take anywhere from 2-5 weeks to switch and they can’t predict when it will actually happen and I can’t give them my preferred start date.

I realise I can just let it run over a couple of weeks, it won’t cost that much in reality but it strikes me as nonsensical that I cannot instruct suppliers as to the date I want to switch on. This is another aspect of complicating the process, potentially making some money out of those who fall foul of the penalty clauses or who spend too long on much higher tariffs and putting a whole host of other people off switching altogether. Suppliers should be forced to offer dates for closing and opening accounts as long as there’s reasonable notice, which I’m trying to give them.

Lyndon says:
1 August 2013

I have also become a serial switcher and entirely agree with Sharon’s comments. Switching takes 4 to 6 weeks and new suppliers will not commit to a specific date. Inevitably this means that you leave switching until your contract is about to expire and are transferred to your current supplier’s standard (more expensive) tariff, or risk exit penalties that are likely to wipe out potential savings. Switching supplier is an administrative task that should take no longer than 14 days. It must be possible to set a maximum period that is more realistic than 6 weeks and for suppliers to agree dates.

Lyndon – Ofgem’s Retail Market Review proposals say “We are amending existing rules in SLC 23 to make it easier for customers to switch supplier or change tariff without being affected by a price increase or other adverse unilateral variations.” Let us hope this enables you to switch tariffs or suppliers without these problems – that looks to be the intent.

This information from Ofgem regarding revised energy consumption for low, medium and high consumers may be of interest:

I regularly switch energy supplier, usually selecting a fix term fixed price deal. I have to say it’s NOT a pleasant experience. Most of the suppliers and the web comparison sites are not sufficiently transparent about charges and don’t make it clear when there are BETTER deals available for new customers than for an existing customer.
As for switching itself – this takes FAR too long (mobile phone number switching takes days not weeks or months) and is ERROR prone.. I very rarely manage to switch without having to make multiple calls to the two companies involved – this is because of faults/delays in transferring meter readings and meter flow data etc etc.

The regulator is no help in such cases and seems happy to accept the level of account switching errors and the ridiculous timescales it takes to resolve them. I once had my account transferred, in error, to another supplier – this took nearly 3 months before it was fully resolved !! – OFGEM wasn’t interested.
Perhaps OFGEM could lean something from OFCOM.