Number of consumers switching energy supplier increased again in July and Smart Meter Installations jumped 120%

Recovery

The data suggests that the number of switches is recovering from the declines recorded at the height of the Covid-19 pandemic and subsequent months long lockdown.

During the month 519,700 customers switched their energy supplier, an increase of 17% on the previous month of June. On a year on year basis the number of switches was down just 1% suggesting that a recovery is well underway as consumers seek out the best deals.

For 2020 as a whole the number of recorded switches is 3,447,234 a figure that is 4% down on the same time last year.

Price cap announcement 

The number of switches could pick up pace further over the next few months following Ofgem’s announcement that it would be cutting the price cap to its lowest ever level as it seeks to assist consumers impacted by the lockdown and subsequent economic downturn.

The regulator announced that the price cap will fall from £1,126 to £1,042 in October.

People will be looking to save money where they can as the UK’s economic difficulties increase in the coming months. The UK government’s furlough scheme will end in October and it remains to be seen just what impact that will have on the jobs market.

Green Home Grants

The governments recently announced Green Home Grants scheme is also likely to have played a role by raising the issue of energy usage in the home to the fore.

The scheme will see eligible applicants receive vouchers worth up to £5,000 to improve the energy efficiency of their homes. The scheme begins in September and millions of homeowners are expected to take advantage of it.

“It’s encouraging to see switching numbers continuing to pick up following an understandable slow down earlier in the year. Although Ofgem last week announced a forthcoming cut to the price cap, it’s still very much worth customers checking they’re on the best deal for them – either by contacting their own supplier or checking across the rest of a very competitive market.

‘Improving the energy efficiency of homes is still the best way for customers to reduce bills over the longer term – so hopefully as many customers as possible will also be taking advantage of the Government’s Green Home Grants when it gets underway,” said Emma Pinchbeck, Energy UK’s chief executive. 

Nearly half of all switches was away from the ‘Big Six’

In a further indicator of the increasing competitiveness in the energy sector the data showed that 45% of all switches were from the larger ‘big six’ energy supply companies to small and mid-tier ones.

In comparison, just 10% of switches went the other way and 20% were between larger suppliers with the final 25% between small and medium-sized suppliers.

Smart meter installations jump 120%

New data released by ElectraLink shows that the number of smart meters installed across the UK in July increased by 120% from the previous month as Covid-19 restrictions continued to ease.

On a year on year basis the number of meters installed was still down by 36% but it does suggest that the pace of installations is increasing.

Overall, 13,620,245 smart meters have so far been installed since the smart meter programme began.

Further Reading

Covid19: Energy Supplier concerns over bad debt grows ahead of furlough scheme end

Bulb Energy ordered to pay £1.76 million by Ofgem and energy price cap to fall to lowest ever level in October

Half of Energy Suppliers have failed to hit Smart Meter Installation Targets

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