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Would you switch to a smaller energy provider?

Customers of medium or smaller energy providers are more satisfied overall than those with the ‘Big Six’. Should you switch to a smaller provider?

A quarter of us are now customers of energy firms which aren’t the original ‘Big Six’. Some of these newer and smaller firms offer fantastic service, while a few are seriously letting customers down.

The recently-published results of our annual energy companies satisfaction survey revealed the best energy firms, according to their customers, as well as the ones to avoid. (Full results for Northern Ireland can be found here.)

Top scorers

The top-scorers were Octopus Energy, Ebico, Robin Hood Energy, So Energy and Tonik Energy. The worst supplier overall was Solarplicity. Spark Energy was the second-lowest ranked.

What do all of these have in common? They’re new, relatively small (at least in comparison to the Big Six), energy firms. A couple are not-for-profit. A couple sell only 100% renewable electricity.

Overall, we found that customers of medium or smaller energy providers are more satisfied with them, and rate them better on everything from customer service to bills to value for money, than customers of the Big Six.

Which? Switch: compare gas and electricity prices

But it’s not as simple as switching from the Big Six to get better service or prices.

Smaller suppliers are streets apart in how well they serve their customers: some are top of our rankings, others are seriously letting their customers down. Plus several have gone bust, and many have raised their prices. So choosing a supplier can feel a bit of a minefield at the moment.

Downsizing

Over the last four years, I have been a customer of four different gas and electricity suppliers. I’ve tried Big Six, medium-sized, and most-recently a smaller, newer market entrant.

My current, smaller, supplier doesn’t offer a breakdown of my energy usage via an online account, unlike my previous supplier. Perhaps it’s too new to have built this, undoubtedly expensive, feature yet.

But I never actually saw the fancy offering from my previous supplier: it wasn’t able to fix my online account login issues in the six months I spent as a customer.

It also doesn’t have answers to any question you might have on its website, ready and waiting for when you need help at 11pm on a Sunday.

Simple things

But what it does do is respond to my emails (usually within a day), answer my questions precisely and does what it says it’s going to do.

These are simple and basic things but mean I feel friendly towards my supplier, rather than frustrated.

Revealed: the fastest energy firms to answer the phone

Plus I’m never in doubt that my bills are accurate or worried that I’ll have to pay more than I expect. It prompts me to send meter readings every month, and gives me a few days warning before it takes my direct debit.

I can enter my meter readings online (no more using up my minutes phoning in my meter readings). Again, simple things, but certainly reassuring.

I can’t promise I’ll stick with my smaller supplier for the long-term but, for the moment, what it lacks in fancy features it more than makes up for in getting the basics spot-on.

Have you switched to a smaller energy company? What differences have you noticed? What do you like about its service and what do you miss?

Comments

Another small energy company has gone bust according to this Which? press release:

Which? responds as Brilliant Energy ceases trading
11 March 2019
Sarah Threadgould, Which? Chief Customer Officer, said:

“The collapse of energy firms is becoming far too commonplace and consumers must not be made to shoulder the costs for these failures. It is vital for the regulator to press ahead with measures to ensure that current and future suppliers are financially sustainable and able to deliver excellent customer service.

“Ofgem must ensure a smooth transition for those customers affected. People should not let energy suppliers going bust put them off shopping around for a better deal. Once affected customers have been moved to a replacement supplier, switching is still by far the best way to find a company that offers good customer service – and you could save more than £300.” https://press.which.co.uk/whichstatements/which-responds-as-brilliant-energy-ceases-trading/

It seems that this company was struck of on 21 August 2018, so why has it been able to continue trading. The 17,000 customers will not lose out but it is yet to be announced which company will take over. Nothing in the filing history for Brilliant Energy suggests to me that it might be a viable company: https://beta.companieshouse.gov.uk/company/07283391/filing-history

As Which? has stated, Ofgem must do its homework and decide if companies are likely to be sustainable and cope, for example, with a significant rise in wholesale prices of energy. Surely this is obvious. We have now had about ten small energy companies fail and I wonder if Ofgem is fit to do the job. Perhaps the effectiveness of regulators needs to be assessed.

DerekP says:
12 March 2019

Indeed.

Ofgem were wrong to allow so many entrants into the energy marker without them demonstrating financial resilience. There were over 60 at one count. I believe some of this were opportunists, taking money out of the business before it failed in inappropriate ways. Some were no doubt naive. Some are run by local authorities, providing them with bail outs, by people who do not have business acumen; they, too, would have otherwise gone broke.

Some fail because their fixed price deals become unsupportable when wholesale costs rise beyond what was envisaged, and the company does not have the resources to buy energy ahead to protect against that.

Unfortunately, suggesting that “consumers must not be made to shoulder the costs for these failures.” would leave the deprived customers with their account credits lost; a failed supplier will not return those. So all consumers will pay through their energy bills.

Ofgem some while ago were changing the terms of licensing new entrants so hopefully this problem will go into decline. It does not seem possible to deal with the present incumbents; there will, no doubt, be a process of natural selection but at cost to us all.

So, is Ofgem fit to to their job? As you say, we all contribute to the cost of failure. I hope that Ofgem is monitoring the performance of all companies in the market to look for signs of potential trouble.

Which? has rightly been critical of larger energy suppliers for poor service. It’s well established that some companies have allowed some customers to build up large credit balances. I have had this problem with Scottish Power and e.on, and judging by comments on various Convos this is not uncommon. I wonder why Ofgem has not stepped in to put an end to this practice.

I’m very grateful that we do have regulators but perhaps their effectiveness needs to be assessed.

Maybe the regulators need a …..regulator? They act on behalf the government and presumably are scrutinised by select committees.

“Ofgem is the Office of Gas and Electricity Markets. We are a non-ministerial government department and an independent National Regulatory Authority, recognised by EU Directives. Our principal objective when carrying out our functions is to protect the interests of existing and future electricity and gas consumers………

Our governing body is the Gas and Electricity Markets Authority ………

The Authority members are appointed by the Secretary of State at the Department for Business, Energy and Industrial Strategy and include five Non-Executive Directors………

The Authority’s powers and duties are largely provided for in statute (such as the Gas Act 1986, the Electricity Act 1989, the Utilities Act 2000, the Competition Act 1998, the Enterprise Act 2002 and the Energy Acts of 2004, 2008, 2010 and 2011) as well as ruling European Community legislation in respect of energy regulation.

The smaller energy companies rely almost entirely on household customers and do not have the ballast of commercial, industrial and public service customers which provide greater stability for forward procurement and usually have long-term contracts. Household customers are more prone to switching when they see a better price or their existing supplier increases the tariff so there is more volatility at the smaller end of the market. Ofgem should be factoring this into their appraisal process when judging resilience.

The intro says “The top-scorers were Octopus Energy, Ebico, Robin Hood Energy, So Energy and Tonik Energy.

Robin Hood Energy is “run” by Nottingham city council, and, in the past, it has been reported they injected money more than once to keep it afloat. According to a report in Private Eye (8-18th April), it has tried to adopt perhaps less acceptable tactics (for a council run operation) to grow its business. It acts as a white label supplier to a number of other councils who use it to market their own energy. It proposed offering new customers better (loss making) deals than given to existing customers. As they claim they make no profit and no demands on the taxpayer it is concluded that their existing customers would subsidise this tactic. When uncovered, the plan was quietly dropped.

Maybe we should look harder into all these energy companies when recommending them? I’m all for taking advantage of the best deals on offer but I’d like to see all these deals as genuine commercial offerings where taxpayer’s money is involved.

DerekP says:
25 April 2019

I’d definately rate Ebico as a “don’t buy” supplier.

Having recently switched to Ebico (or tried too) I’m really surprised to see them in a list of satisfaction survey top-scorers.

In my case, Ebico were unable to make good their offer to take over my gas supply and were almost impossible to contact, when I needed to sort out the resulting mess.

In contrast, my other supplier, Scottish Power were easy enough to phone and their conduct was smart and professional.

When I was with Scottish Power they doubled my direct debit, even though I was well in credit – without even sending an email to tell me. Yes they were easy to phone and I had to do that a few times because they kept pushing up my direct debit when there was no need. I’m not surprised that SP remains near the bottom of the Which? list for customer satisfaction. I had not chosen to become an SP customer but they had been selected as supplier for a collective switching scheme run by the council.

I’m happy with my present supplier and have not had to phone them to complain about anything. They do not keep me well in credit because they would have to pay me interest if they did.

I’m with SP; sent my meter readings in a couple of days ago and the same day they recalculated my account and increased my DD by about 8% (after a reduction earlier in the year) to keep pace with my predicted use. They seem to be on the ball.

I’ve switched suppliers a number of times and SP have always been easy to deal with, helpful on the phone (they have a call back timed service if they are busy) and respond to emails.

You and Derek have had good experiences but mine seems to be in line with the findings of Which?

With my present supplier my balance is £70.12, my projected cost for the month is £56.22 and if I want to decrease my monthly payment from £65 I can do it in less time than it took me to write this. I will alter it when I receive an email saying that the next statement is available. I’m in control and don’t need to contact customer service.

If I become disappointed with my current energy supplier I will consider smaller energy companies, but not before checking to see what Which? and others have to say and checking the company’s annual accounts. I know that customers have not lost out when small companies have gone bust but I would rather not take the risk of being dumped with a company with a poor reputation.

If Ofgem monitors the financial stability of suppliers, perhaps action will be taken before another small company goes bust.

Looking at the Which? results I wonder at their basis.
– I send meter readings in regularly when SP email me to request them (monthly) and my bill is updated. It is accurate. So when they get 2* for bill accuracy I wonder quite how this happens? Is it done on estimates because customers do not submit readings?
– I have used their phone service (they offer call back at a specified time) and email a number of times and received prompt and useful responses. So customer service is based on what? 2*? Not for me.
– Value for money 3*. They are not the cheapest but I do not like small energy suppliers with an unknown track record who may well be cheaper. Out of the known suppliers I got a good fixed price tariff from SP and am happy with my compromise.

As for Ebico (not for profit??) given 5* for value for money; well, they are 15% more expensive than my SP tariff given a 3*. How does that make sense?

I suggest all this information needs to be treated with a good deal of caution. Sort out your best deal (for your criteria) by looking at all companies online. Which?Switch works well for me.

I change my energy supplier fairly regularly & was with One Select who went out of business in mid December 2018. I was told my supply had been moved to Together Energy (who I’d never heard of) but was not given any information about their tariff etc. It took until 27/02/19 (75 days) to get a final bill for my One Select account & I then immediately changed to Bulb.

I did not get my final bill from Together Energy until 17/04/19 & was horrified at how much more it was than I had expected. When I compared it with my old One Select tariff it was £55 more for the 75 days, an increase of 28.7%. I am owed a refund of £31.09 which I have not received yet.

It seems very wrong that customers should be penalised in this way when their supplier goes out of business; is it possible to change to a supplier of the customer’s choice immediately? Perhaps I shouldn’t have waited the 75 days for the final bill for my failed supplier.

When you select a cheap energy supplier you do take a risk on the sustainability of their business, as we have seen from the clutch of failures over the last 15 months – 10 so far. As most people will have selected them online the switch to another supplier should be easy; you don’t have to take the “supplier of last resort” that agrees to take on the customers but I think it helps with the initial changeover and refund. You can then switch to another chosen supplier.

Which? recently published this:
https://www.which.co.uk/news/2019/04/failed-energy-firms-leave-customers-facing-higher-bills-and-missing-refunds/

”as is the nature with human stories, we have to pick a few.

A couple of days ago I had an email from npower to tell me “my payment scheme was cancelled” and I would receive quarterly bills instead of a monthly direct debit. That evening I emailed their complaints department and received an immediate acknowledgement with a complaints reference. I phoned them the following morning to follow up my query, got through to a helpful person straight away who looked it up, said it was an automated email sent because my fixed price electricity deal had ended and I’d changed suppliers but my gas contract was still intact. Had I received an email that morning? It said all had been restored and the problem was resolved.

There are frequent criticisms of energy companies’ customer service, no doubt rightly so. However here is a “human story” that shows, in my view, pretty good service. Just to add balance. One swallow does not make a summer – but neither does it make a winter. ”

It might be good if, sometimes, more positive experiences were published by Which? instead of negative ones. But then we Brits are a nation of moaners, according to the Daily Star (so must be right) 15/12/2014: ” Britain is a nation of moaners who complain more than 70 times a week each“.

I guess Which? Conversation is one of the biggest continuous and regular receptacles of moans with appeals for more added every day.