Editor’s Pick | H119 energy switching up 17%

Some 5.8mn electricity and gas switches were reported in the first six months of 2019 (H119), up from 4.97mn a year early.

Energy UK reported on 22 July that electricity switching in June was 440,323. While the figure was down 9% year-on-year, the H119 total of 3.047mn was up 10% on a year earlier (see Figure 1).

In June, 35% of switches were customers switching from a large supplier to a small and medium supplier (SaMS), while 16% were from SaMS to large suppliers, 26% were between large suppliers and 23% between SaMS.

Xoserve gas switching data showed that there were 339,357 gas switches in June, which is both a 12% fall on May and a 12% decrease on June 2018. In total H119 total gas switches were up 25% year-on-year at 2.745mn.

Energy UK Chief Executive Lawrence Slade commented: “Whilst our figures show there has been a significant decrease last month, switching remains up on last year, and our hope is that consumers will continue to shop around for a better deal.” Slade highlighted that “with around 60 suppliers on the market, consumers have now more choice and services offered to them than ever before” and said the best way consumers can reduce energy bills is to use energy more efficiently by getting a smart meter or investing in energy-efficient measures such as roof insulation.

Of the H119 electricity switches, 1.266mn were from one of the six large suppliers to a SAMS, with 0.365mn opting to move the other way (see Figure 2).

The net gain for SaMS was 0.9mn, equivalent to 30% of all electricity switches and similar to the 29% equivalent figure for 2018. In that year a net 1.713mn electricity switches to SaMS from the large suppliers was recorded.

The peak month in H119 for electricity switching was April when 668,371 switches were recorded, a level 34% up on year-ago levels. March 2019 electricity switching was up by a similar 29% on year-ago levels at 615,503. The other four months were within 5% of 2018, with the exception of June’s 9% fall. The gas switching peak was in January at 572,038, a level more than double a year earlier due to the inclusion of supplier of last resort (SoLR) portfolio switches of failed suppliers. March and April 2019 gas switches were 12% and 42% up on year-ago levels at 495,064 and 535,674 respectively.

The two months of peak market switching were those around the raising of the two price caps, suggesting the news flow around this event has prompted consumers to engage.

Without this spike, switching would still have maintained the then-record levels seen a year ago. Energy switching then was 17% up on H117.

Energy UK      Xoserve

If you have enjoyed reading Tom’s views and want to read about the latest developments in the energy market and more, please contact us for a month’s trial of Energy Spectrum.

Energy Spectrum is a weekly publication covering all of the key policy, regulatory, market and transactional developments across the energy sector. It offers a timely, insight-driven overview of the need-to-know news and changes in the energy sector. Contact Nick Palmer to request a trial on 01603 604400.

Related thinking

Regulation and policy

Ofgem raises modifications ahead of RCC and new switching arrangements

The latest edition of our Faster Switching Service Report due to be issued this week includes the latest developments in Ofgem’s Switching Programme and the associated Retail Energy Code (REC). Launched in November 2019, the Retail Code Consolidation (RCC) Significant Code Review (SCR) set out Ofgem’s intention to amalgamate the...

Home supply and services

A look back at 2020 part 3

As we take our first steps into 2021, we continue to look back at the biggest developments in the UK energy markets in 2020, setting us up for the significant year ahead. The mergers and exits from the supply market that were seen in 2019 continued into 2020 and led...

Home supply and services

Responses to COVID-19 boost energy suppliers’ reputations with customers

2020 is, unfortunately, proving to be a year that we will never forget. It has been a year of change and adaptability for us all, including domestic energy suppliers, with many suppliers having had to adapt to increasing numbers of customers in distress while operating at reduced capacity and/or with...

Regulation and policy

How will suppliers be required to support their customers post COVID-19?

On 1 May our latest update to the Energy Supplier Compliance Portal went live and included changes to the compliance landscape seen during February, March and April this year. A notable feature of the update was the regulatory response to COVID-19, which we will delve into a little deeper in...

Regulation and policy

Points for trying: switching data cleanse struggles over the line

While Ofgem has been pressing the industry to cleanse its data ahead of the future switching arrangements, the Switching Programme has missed one of its data checkpoints by a noticeable margin, prompting remedial actions. The Switching Programme is moving the industry towards new arrangements from July 2021, which should see...

Home supply and services

Comparing smart tariffs – could it be smarter?

By the end of September 2019, 15.6mn households had a smart meter installed, increasing access to consumption information and monitoring. While only a small proportion of households currently use half hourly tariffs (and there isn’t currently market wide half hourly settlement of domestic smart meters), the industry is widely discussing...

Home supply and services

Not mushroom for competitive prices: Switching behaviours in the SEM

The Commission for the Regulation of Utilities (CRU) published its August 2019 Customer Switching Report for the Electricity and Gas Retail Markets on 24 September. In this edition of the blog, we compare monthly switching trends with CRU’s quarterly Electricity and Gas Retail Markets Report to explore whether fluctuations in...

Regulation and policy

Progress or Regress? – The Vulnerability Conundrum

On 25 September Ofgem released its Vulnerable Consumers in the Energy Market: 2019 report. The report shows how well suppliers are doing in supporting those customers who need extra help. The results are mixed, with some good progress being made, but there are clear challenges that still need to be...