Only 1/5 business shop around for energy

Most small and medium-sized firms were missing out on savings by failing to shop around for their energy supplies.

Julian Morgan, managing director of the price comparison, switching and advice service for energy users, said he was shocked by the findings of the survey by independent supplier Opus Energy.

The survey found that 81% of small businesses failed to shop around for their energy supplies, while almost one-quarter were paying out-of-contract rates for their gas and electricity.

Significantly, 12% of businesses had never switched suppliers, opting to stay loyal to their existing energy company.

“It’s very clear, and actually quite shocking, to see that so many time-pressed small business owners and decision makers are simply not prioritizing their energy supplies,” Mr Morgan said.

“There’s no doubt that most of these firms are paying more than they need to by not switching – and depending on the size of the company and the sector they are in – this could amount to hundreds of pounds in lost savings each year.

“Those companies that have never switched suppliers have lost out the most, probably by a significant amount.”

Mr Morgan said many SME owners wrongly believed it was not worth their while to switch suppliers, and that it would be a long and complicated process to shop around.

“Nothing could be further from the truth, “ Mr Morgan said. “Using a reliable and reputable switching service like the Energy Advice line means business owners save themselves all the legwork. 

“And once we find them a cheaper deal, we handle the switching and provide a free contract management service as well. There’s no obligation and the service is free.”

Mr Morgan particularly appealed to small firms that had never switched suppliers, and those who were on expensive out-of-contract rates to shop around for good fixed-rate deals.

In other areas, the Opus Business Boost Report showed that the majority of UK SMEs were trying to manage their energy better and had adopted a positive attitude towards renewable supplies. 

Of the 500 SMEs surveyed, 78% said they were keen to be supplied with renewable energy and of these, 40% wanted it because of its smaller environmental impact and 38% to advance their green credentials. 

More than half (51%) of businesses already have smart meters to help them keep track of their energy use, although a fifth didn’t know how to use their meter.

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 service for business energy customers throughout the to of their energy contracts.

For further information visit www.energyadviceline.org.uk

Energy should be simple - let's make it so

The Energy Advice Line has welcomed calls by an industry insider for the Big Six suppliers to introduce simple changes that would see customers paying less for their energy, and being treated more fairly.

Julian Morgan, managing directer of the price comparison, switching, and advice service for energy users, said regulators should heed the comments by First Utility, a leading independent supplier, and enforce the changes.

"First Utility has echoed what we have been saying for some time - that energy companies need to make simple changes, like actually talking to their customers, in order to restore trust and deliver them a better deal," Mr Morgan said.

"We hope that Ofgem takes on board what this supplier is saying and apply the recommendations across the market - and crack down on those who don't fall into line."

Ed Kamm, chief customer officer at First Utility, has claimed that the Big Six suppliers avoid communicating with their customers because they know customers are "overpaying".

Mr Kamm made the claims as he identified four simple changes suppliers should be forced to make to ensure households and businesses pay less for their energy and are treated more fairly. He said regulators should:

• force suppliers to talk to their customers: customers who were prompted to supply meter readings or switch to a new tariff when their deals epired, were likely to pay less for their energy
• call things what they are: 70% of major energy supplier customers are on a standard tariff, which generally costs hundreds of pounds more than the cheapest deal. Mr Kamm said there was nothing standard about this tariff and that it should be called 'out of contract tariff'
• make switching easier: introduce 24-hour switching and fine suppliers who fail to get it right
• make bills and tariffs simple: not succumb to pressure from suppliers to reverse recent changes that slashed the number of tariffs each supplier can offer to just four

Mr Morgan said all of the recommendations, especially making switching easier, could transform the relationship between customers and suppliers that had suffered so badly in recent years.

"If suppliers were customer-focused rather than profit-focused, all parts of the energy market would benefit, including suppliers themselves," Mr Morgan said.

"Customers should be told when cheaper deals are available, their tariffs should be simple to understand and it should be simple to change supplier if there are cheaper deals elsewhere.

"But this is not the way it works in practice. Suppliers have built their business models on discouraging customers from engaging with them or taking a pro-active approach to their energy supplies.

"It's got to change and we hope Ofgem takes heed of what this industry insider has to say."

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.

This 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 www.energyadviceline.org.uk