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Collective switching has been in the media a lot in recent months, with the concept dividing opinion as to whether or not it represents the best option for domestic and business energy customers. In true Love Energy Savings style, we have put together another one of our fantastic energy guides in order to ensure you have all the information you need regarding this somewhat controversial topic.


Collective Switching

Fight The Price Hikes...

As someone who will be paying home or business energy bills already, you will already be more than aware that your prices have more than doubled since the turn of the millennium. With the recent recession compounding the issue, this has meant that gas and electricity prices have increased by in excess of eight times more than any of our salaries. Despite this, less and less people have been switching energy suppliers to get themselves onto a more affordable tariff.

2008 saw a record high of 9.6 million energy customers move to a better supplier, but this has slipped away and experts predict that 2013 could turn out to be a very poor year for customers paying over the odds for their all-important energy. Although there are some customers out there doing the prudent thing and switching at least once a year (rate tarts as they are affectionately known), it is thought that seven out of every ten consumers have remained with their energy supplier, no matter what they are paying.  So, the majority of energy customers out there are getting a raw deal, whilst the energy companies record profits in the billions.

In a bid to combat these trends, the government and Ofgem have tried a range of measures and legislation to encourage the energy companies to pass on some savings to the consumer, these have had limited success however. Not for the first time in the UK, the concept of collective switching has been put forward as a solution for energy customers but it should be approached with caution, as our research has highlighted.

What Is Collective Switching?

The process is fairly simple. Thousands of customers sign up to the collective switching campaign in question. Once there are enough members, the scheme will go to the suppliers and negotiate a lower price due to the fact that so many customers are looking to move; supposedly harnessing ‘people power’ to get the very best deal. Many energy suppliers will bid with their lowest price and the best offer wins, all registered customers will then be offered the opportunity to switch over. Sounds too good to be true, right?

Has Collective Switching Been Done Before?

Yes. Local councils across the United Kingdom have looked to negotiate better deals on the premise of a large amount of consumers switching over in the past. Succesful campaigns have been enjoyed in several areas, most notable Oldham and Nottingham. Which? also conducted their own Big Switch in 2012 and managed to get more than a quarter of a million energy customers onto a more affordable energy tariff. The biggest switch of this kind was seen in Australia, where it was supported by The Daily Telegraph and the average saving was around 16.5% compared to previous bills. The latest collective switching initiatives will no-doubt be looking to emulate the success of these efforts and even make greater savings than those than have gone before them.

Is Collective Switching the Best Way to Save Money on Energy?

No. Despite the obvious money saving advantages to be enjoyed as a result of a collective switching campaign, many areas of the media and the team here at Love Energy Savings are still certain that energy comparison sites are still the best way to save money. Ulitmately, the clue is in the name as it is a collective deal and will therefore, not be specific to your home or business’ needs and requirements. When we go out and find you the very best business electricity prices or compare gas rates across the UK, we find this information based on your usage and locale. There is no way this can be emulated through collective switching and although it will probably save you money, it won’t be the greatest rate you can find.

For example, after the Which? collective switching campaign in 2012 there was widespread criticism as the final offer was not actually the best on the market. By the time negotiations had ended, deals had changed and customers did not actually get the cheap energy prices they were looking for.

Another flaw to collective switching is the fact that there are so many people switching their energy providers. This, as was the case with the Australian scheme, means that the new energy provider is inundated with enquiries which naturally lowers the level of customer care provided.

Perhaps the most crucial downside to opting for collective switching as opposed to an energy comparison site is the amount of time it will take you to switch and therefore, save money. With the registration process for these projects been somewhat long winded and drawn out, it can take in excess of three months to actually make any savings. In contrast to this, Love Energy Savings can get your enquiry turned around in as little as one month therefore ensure you save cash as quickly as possible. Don’t forget that if you are already in the middle of a lengthy energy contract, you may be charged for leaving this early, making it even more important that you save as much money as possible – rendering collective switching as even less appealing when compared to a traditional online energy switch.

Save More Cash Through Online Energy Comparison...

In summary, it cannot be denied that collective switching can be of use to consumers looking for a better deal when it comes to their gas and electricity. That said, the savings are very unlikely to be as high as a comparison through a service such as the one we offer right here at Love Energy Savings. With one price being offered to thousands and thousands of customers, this is not bespoke and will not take into account your specific situation.

If you would like the energy specialists here at Love Energy Savings to take a look at your domestic or business energy situation and find you a better deal, simply click this link or you can navigate to our online comparison service here.

Take a look through our blog and the rest of this ever popular energy guides section.