Number of consumers switching energy supplier soars after Ofgem Energy Price cap rise
The number of consumers switching energy supplier soared in March with smaller energy suppliers seeing a 34% increase in the number moving from larger suppliers ahead of the price cap change.
Second highest number on record
The number of completed energy supplier switches hit the second-highest number ever in a single month with 649,000 customers successfully changing their energy supplier according to the latest data from Electralink.
Ofgem hiking the energy price cap on April 1st was the main motivator for consumers to seek out better deals and cheaper energy tariffs. The amount of supplier switches was 10% higher than in March last year when the impact of the Covid-19 pandemic was first recorded.
More consumers working from home, long spells of colder weather and the increase to the price cap were the biggest motivators for the rise in switching.
The switching figure is just below the record 669,000 switches completed in April 2019, but April 2021 could see that number broken as concerns over finances and the rising cost of energy bills come to the forefront of many consumers thinking.
Record high number of switches started in March
The number of supplier switches started in March was also higher than on the previous year with a total of 884,000.
Smaller suppliers continue to snap up customers from the larger suppliers with the data showing that 177,000 consumers switched to smaller suppliers from the bigger market players. This figure marked a 34% increase on March 2020’s figure and made up 27% of March 2021’s total switches.
The highest number of switches however was from large supplier to large supplier with 341,000 switches recorded and was 18% higher than the same time as in 2020. The main cause for this is that some consumers remain wary of smaller suppliers and feel more confident sticking with more established companies even if they aren’t offering the cheapest tariffs.
Also read: Energy Switching down year-on-year in February but Price cap rise expected to spur an increase
“In February’s Change of Supplier (CoS) update, we predicted a spike in switching in spring after Ofgem’s announcement of an increase to the standard variable tariff price cap owing to high wholesale electricity prices. Queries running through one of our APIs have jumped into the millions recently, forewarning us of the likelihood of increased switching activity well before the trend started. Validation of this prediction with data from the Energy Market Data Hub demonstrates the power of data to monitor market activity,” said Dan Hopkinson, Acting CEO at ElectraLink.
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