Price is key factor for 75% of Scots consumers when switching energy suppliers

Big Six logo montagePrice is the most important criteria for three in four Scottish consumers when  considering switching to a new fuel supplier.

But while 74% cite price as the key criteria, the actual number of Scots actively considering switching is low – just 20% – according to a new survey by Ernst & Young.

Of those thinking of switching, 29% would switch to one of the ‘Big Six’, 29% would switch to a new entrant and 41% are not sure.

Tony Ward, Head of Power & Utilities at EY, said: “While levels of awareness are admittedly still relatively low among energy consumers, the situation is certainly improving. The increased focus on living costs, as well as industry and government led campaigns have helped make shopping around to get a better deal an increasing priority.”  

When asked what customer service elements would most likely cause them to decide to switch their energy supplier, 39% of consumers said that inaccurate bills would lead them to take that decision. Unfriendly service when calling the helpline (16%) and long complaint processes (12%) were also among the top reasons that would trigger a decision to switch.

On Wednesday, the UK Competition and Market Authority’s report into the energy market revealed that energy customers are missing big savings due to not switching. Millions of Big Six customers could have saved up to £234 by switching tariffs or suppliers.

Commenting on why, with wholesale prices falling and consumers yet to see the benefit, energy providers are still struggling, David Hunter, energy analyst at Schneider Electric, said:“In the wake of falling commodity costs, the domestic energy market is being heavily scrutinised on prices and profitability.

“Over the past six to seven months we’ve seen consistent falls in wholesale prices. But with many energy providers buying in advance to mitigate risk and volatility, these savings have been slow to trickle through.

“Whilst we’ve seen reductions in energy bills, they’ve not come down by anywhere near the same margin. At the same time non-commodity prices are rising as we seek to re-wire Britain and pursue a low carbon future.

“The CMA’s early findings around consumer savings were unsurprising, but more needs to be done to educate and engage consumers on switching.

“Savings and ‘shopping around’ is certainly not an issue exclusive to the energy industry. The insurance and banking industries are dealing with similar concerns and in banking certainly, the complexity of switching has been subject to regulation.

“Some will say that we need to regulate a cheaper energy price for all, but many will argue that if you want to find the best deal, shopping around is a fact of life.”

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