Saturday, 24 September 2016
More incentives needed for users to switch
The Energy Advice Line has welcomed new figures showing a 30% increase in the number of consumers changing suppliers in the first half of this year.
But Julian Morgan, managing director of the price comparison, switching and advice service for energy users, said more needed to be done to incentivize consumers languishing on standard variable tariffs.
"We certainly welcome the fact that more and more consumers are heeding the message that they need to switch supplier to save money on their energy bills," Mr Morgan said.
"But there are still worrying numbers of householders paying over the odds because they're on standard tariffs - the most expensive way to pay for your energy.
"This significant core group of consumers needs to be targeted by the government and the energy regulator, and ways found to encourage them to change their habits so they don't continue to waste money by paying more for their energy than they need to."
Ofgem recently published new figures showing that more than 3.8 million UK households switch supplier in the first half of 2016 - around 1 million more than in the same period last year. Of these, around 1.6 million domestic customers switched gas suppliers and 2.2 million domestic customers switched electricity suppliers.
The data also shows that consumers have more choice than ever, with over 40 suppliers now competing for their business.
However, Ofgem's data also revealed that 66% of domestic customers were still on expensive variable tariffs, despite repeated warnings that switching supplier and moving to a cheaper, often fixed-term deal, could yield savings of £300 or more.
"Ofgem claims that introducing reforms recommended by the Competition and Markets Authority (CMA) earlier this year to better protect those on pre-payment meters and increase competition for all other customers, would encourage more people to switch," Mr Morgan said.
"However, their own figures show that much more needs to be done. There are some great deals out there, and more suppliers than ever to choose from, yet many people are either unaware of this and how much money they can save, or believe it's too difficult.
"Ofgem needs to drive home the message that, with winter coming, consumers need to be active when it comes to their energy suppliers and seek out savings."
To encourage more switching, Ofgem plans to trial "more effective prompts" on customer's bills to encourage them to compare different tariffs. But the regulator has ruled out capping standard variable tariffs.
The Energy Advice Line is one of the UK's leading price comparison and switching services for business and domestic energy customers. It is also an advocate for energy market reform and has campaigned for a better deal for energy users, including calling for a ban on cold calling and changes to regulations to make it easier for all consumers to switch suppliers.
The service is completely independent and free. Consumers can quickly and simply search the market for the best available energy deals from an extensive panel of small and large energy suppliers. The service also offers a free advice line for business energy customers.
For further information visit energyadviceline.org.uk