Recent figures reported by Ofgem have highlighted that, compared to 2019 data, the number of customers switching supplier in the second quarter of the year has continued to fall.
|Switches in Quarter 2|
|Switches in Quarter 2|
Figures taken from ofgem.gov.uk
As per the figures above, 2020 saw a 13.1% decrease in electricity customers switching suppliers (the lowest since the first quarter of 2018, where 1,190,000 customers switched supplier) and a 20.7% fall in customers switching their gas supplier.
It is perhaps no surprise that, in the midst of a worldwide pandemic, switching energy suppliers hasn’t been top priority for the majority of people and we would be forgiven for accepting this as the sole reason for the decline, however, recent research by CompareTheMarket has suggested that the introduction of the energy price cap in 2019 may also be playing it’s part.
In April 2020, fixed rate tariffs were at their lowest price in almost 3 years, with approximately 200 available tariffs coming in at under the energy price cap level. At the time of research, the cheapest fixed rate tariff was actually £252 lower than the cap (which is currently sits at £1,042) and the average price of the 20 cheapest tariffs was £851.
The energy price cap is doing a fantastic job of protecting around 11 million households from paying over the odds for the gas and electricity, by preventing suppliers from unfairly increasing the costs of energy supply to their more loyal customers, however, consumers are being urged not to become complacent as a result of this – As the study demonstrates, there is still a number of available tariffs that are significantly cheaper that the price cap.
Throughout the initial lockdown period, research indicated that the average household saw an increase of £32 per month in their energy bills. And so, whether it is simply a result of COVID-19 and people’s priorities being elsewhere, or whether the energy price cap has played it’s part and caused an element of complacency, with many people already facing financial difficulties as a result of the pandemic and with a potential second lockdown looming, should we perhaps be placing more importance on saving money where we can?
What Is The Importance Behind Switching Suppliers?
Exceptional circumstances aside, there is absolutely no requirement to switch energy supplier unless you choose to. However, many people still believe that remaining a ‘loyal customer’ will gain them a reward in the form of cheaper tariffs – This is generally not the case.
Once the term of your fixed rate tariff is complete, your supplier WILL NOT kindly get in touch to offer you their up to date rates that best suit your circumstances… You will simply roll over onto their standard default tariff, which tends to be much more expensive, in the hope that you will continue to pay these increased rates.
Once your existing agreement is over, switching to a new supplier can often save you significant amounts of money. Switching supplier regularly – Whether that’s from one variable tariff to another, or at the end of your fixed term – Can ensure you are almost always on the best possible tariff for your circumstances and not being overcharged.
How Do I Switch Suppliers?
Switching energy suppliers is actually a very quick and simple process. Initially comparing suppliers’ tariffs and confirming you would like to switch should take no more than 10 minutes. From this point it will take around 21 days for the switch to happen, of which you have an initial 14 day cooling off period should you change your mind. You won’t even need to tell your old supplier you’re leaving them – That will all be done for you!