2019 broke records for Energy Supply switching thanks to increased Competition

April saw the highest number of switches with over 670,000 being recorded with the monthly average being 530,000. 2019’s figures were a 9% increase on 2018’s figures and more than double 2014s.

The dominance of the ‘Big’ energy companies has taken a hit over the last few years thanks to the increase in the number of challenger brands. These smaller competitors now hold 30% of the UK’s market share and that figure is likely to grow as they often provide cheap tariffs in order to attract a customer base.

“With switching at a record high – with on average 12 switches every minute in 2019- it’s evident that competition continues to flourish in the retail market and customers are benefiting from new innovative products and services. There are around 60 energy suppliers and the rapid market changes in recent years have now led to a point where we no longer have a Big Six” said Energy UK’s interim chief executive Audrey Gallacher.

With energy suppliers like OVo, Octopus and Bulb all growing their customer bases the biggest firms will have to step up their game in order to keep their customers loyal.

In December 2019 it was revealed that 167,000 customers switched from the market leaders to challenger brands.

Some analysts had predicted that Ofgem’s price cap on standard tariffs introduced last year, would act as a deterrent to consumers shopping around for better deals. Some had forecast a 30% drop in switching if prices diverged. In reality, challenger brands benefited by undercutting the price cap and their more established rivals.

“These figures show the benefits of switching, with customers potentially saving around £290 per year on their bills. Households can also cut their bills by cutting their emissions – this Big Energy Savings Week I’d urge people to contact the Simple Energy Advice Service to see what they can do,” said Business Minister Kwasi Kwarteng.

With tighter regulations for new entrants to the market Ofgem is hoping there will be less suppliers failing over 2020 by ensuring that they have the right financial backing and systems in place.

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