A national campaign by Which?, designed to reveal the benefits of switching suppliers, has saved 36,000 households on average £223.22 a year.
The scheme, called the ‘Big Switch’ had three parts. Firstly, they collaborated with campaigning organisation 38 degrees, who encouraged people to register for the scheme and spoke about the importance of switching suppliers. Secondly, on the 11th of May a reverse auction was held, where suppliers bid against each other to find the best deal for consumers.
This was won by Co-Operative Energy who proposed a new, market leading tariff for the auction. Since then households that were signed up to the scheme were able to switch to the new tariff, saving themselves a considerable amount of money.
The Big Switch A Good Thing
The scheme has been celebrated as it helps put power back into consumers hands, giving them a voice in the fight against seemingly never-ending price hikes.
It has drawn the attention of both consumers and the media, highlighting the importance of switching. And, as the auction was won by a supplier not included in the Big 6, it means that more people are aware of these smaller suppliers, which can only be a good thing for competition.
However, the scheme has also come under fire. Ann Robinson, director of policy at U:Switch, said that at £1,027 a year First:Utility still offers the cheapest energy plan on the market, coming in at £21 a year cheaper than the winning bid.
She warned households that had signed up to the scheme telling them that they really need to do their own price comparison before deciding if they want to accept the offer from Co-Operative Energy.
Criticism
The deal has also been criticised, as it appeared Which? charged a £40 fee per consumer that switched to the supplier. This saving could have been passed onto the consumer instead of going into Which?’s pockets. Which? Responded to this saying that the fee was essential to cover the costs of the campaign and to enable them to continue with their work.
Despite the criticisms, Which? has opened up the benefits of switching to a wider audience- something that is essential for consumers to understand if they are to get the best deal for their energy.
It is just the kind of action that the IPPR report said was necessary to bring back real competition into the energy market, and to start to bring price rises under control.