Collective switching (the trendier byword for energy auctions) arrived last summer and is set to grow.
What is it and how does it work?
Collective Switching schemes are typically organised at the local level. Local councils (with funds from central government) have taken the lead in promoting these schemes.
A typical scheme works like this:
1. Signing up to a collective switching scheme should be free and without obligation. If you’re charged to sign up then you are probably dealing with a scam. Avoid!
2. You need to know who supplies your energy, what tariff you are on and how much energy you use in order to register.
3. You need to sign up to the scheme before the stated closing date.
4. The auction will run after the closing date. What this means is that the organisation in charge of the scheme is canvassing the energy suppliers for bids and calculating the best one for you.
5. About a week after the closing date you should expect to hear back with a quote offer – i.e. the best deal for you. Then you either commit to switch or you don’t.
Why are collective switching schemes a good thing?
Collective switching schemes seem to reach people that do not use comparison websites to switch to the best deal. That is a good thing because switching is the lifeblood of a competitive energy market. The more people switch the more competitive the market becomes and that is good for all of us (well, perhaps not the suppliers).
Are collective switching schemes better than switching through a comparison website?
Online comparison and collective switching address different markets. If you are comfortable switching online through this website, then by all means (please) do. You are here anyway, right?
Collective switching is currently successful because it brings consumer choice to people who may not be active in the energy market.
And before you ask: besides running this website we also have a big hand in providing switching schemes with tariff data and software services. So we can afford to be neutral in this debate!
What collective energy schemes are currently open for sign-up?
As of today we know of these schemes. By the way, you don’t need to live in these places to sign up!
“Ready to Switch” campaign for Blackpool Council, Cheshire West and Chester Council, Hertfordshire County Council, Hull City Council, London Borough of Havering Council, Luton Borough Council, Northumberland County Council, South Holland District Council, Suffolk Coastal District Council, Waveney District Council, Wiltshire Council and Great Yarmouth Borough Council with Peterborough City Council as lead Council, Started in November 2012 and closed last week
“Great Manchester Fair Energy” campaign for Bolton Council, Bury Council, Manchester City Council, Rochdale Metropolitan Borough Council, Salford City Council, Stockport Metropolitan Borough Council, Tameside Metropolitan Borough, Trafford Council, Wigan Council, Calderdale Council, Gloucestershire County Council and St. Helens Council with Oldham Council as lead Council. Started in December and closed last week.
Up and coming schemes
Check back for information about new schemes coming soon.
We have just launched our Star Ranking for suppliers. As with everything else we try to do, we have kept things simple and relevant. The ranking is displayed with every tariff and shows the likelihood of a supplier successfully processing an application, based on the supplier’s statistical track record. We will review and update these rankings periodically.
5 Stars: 95% or more of applications received are processed ok at the first go 4 Stars: 90-95% of applications received are processed ok 3 Stars: 85-90% of applications received are processed ok 2 Stars: 80-85% of applications received are processed ok 1 Star: Less than 80% of applications are procesed ok No Star: We don’t know enough about this supplier to advise a ranking Continue reading →
npower have told us this morning that the recent backlog of applications has been cleared as of last night. Customers who have switched in the last few weeks and who have yet to be contacted by npower should expect to receive their welcome packs shortly.
Please let us know if you are still waiting to hear from npower in a few days!
UPDATE NOVEMBER 23RD: Although applications are reportedly (by npower) getting processed there remains a bottleneck in sending out welcome packs. We will update this post as we receive more information.
UPDATE NOVEMBER 27TH. No further news from npower about the resolution of this problem except that “we are working on it”. We do understand from a number of customer emails and phone calls that welcome packs have still not been received.
UPDATE NOVEMBER 30TH.
Following a conference call with senior npower representatives, we have been asked to disseminate the following statement:
“If you have recently switched to npower, you may have seen a delay in receiving your welcome pack. We are working closely with npower to ensure that all customers are made aware of this issue. In the meantime, we’re pleased to tell you that your supply is in the process of being switched and that npower will be in touch with you soon about confirming your agreement and your new account details.
You do not need to do anything, however if you would like to discuss this matter further, please call npower on 0800 073 3000.”
We have received the following verbal reassurances from npower:
1) Applications are proceeding.
2) Welcome packs will be generated and sent out by the middle of next week [week commencing December 03rd].
3) Customers wishing to cancel anyway can do so, even if their application was made more than two weeks ago (2 weeks is npower’s ‘cooling-off’ period’)
Based on what we have heard we do hope that npower have indeed now taken the necessary steps to move on from here.
UPDATE DECEMBER 6TH.
The following npower update was provided by email today:
All welcome packs are now ready and we are part-way through sending these out.
By Monday [10th December] we will have sent out all outstanding welcome letters.
All customers should therefore receive their packs by the mid-part of next week [week commencing December 10th].
We have had quite a few enquiries lately from customers with Feed-In-Tariff installations on their roof. ‘If we switch,’ the question goes, ‘what will happen to our Feed-In-Tariff?’
(For those of you who think that a Feed-In-Tariff is another way of ordering food in: The FIT scheme is a government subsidy for people who want to generate electricity from renewable sources, like solar panels. This subsidy is paid out by a supplier). Continue reading →
Ofgem, the UK’s gas and electricity regulator has today launched an investigation into four energy suppliers (npower, ScottishPower, Scottish and Southern Energy and EDF Energy) to determine whether they are complying with new obligations to prevent mis-selling. The investigation covers not just doorstep selling, but also the telesales activities of these companies.
In 2008, Ofgem undertook an investigation into the functioning of the UK’s domestic and small business gas and electricity markets (the Energy Supply Probe). A survey for Ofgem’s probe showed Continue reading →
From today (18 January 2010) energy suppliers will need to provide customers with written estimates before any direct sales are concluded. This is designed to help customers compare the tariff they have been offered with their current deal.
The move comes in response to Ofgem’s Energy Supply Probe. A survey for Ofgem’s probe showed that more than one in two people switching did so in response to contact with a salesperson. However, the survey found that many who switch on the doorstep inadvertently move to more expensive tariffs perhaps because they are misled or unable to accurately compare tariffs. Staggeringly, the Ofgem survey found that 48% of gas switchers and 42% of electricity switchers ended up paying more as a result of a direct sales approach. Even worse, the survey found that vulnerable and prepayment meter consumers are more likely to switch via this route and so were particularly disadvantaged. Continue reading →