After yesterday publishing the Electricity Market Reform, which outlined how consumer energy bills will continue in their upward trend, the Department of Energy and Climate Change (DECC) is today offering advice on how to get a better energy deal.
Secretary of State Ed Davey says consumers can save on their electricity and gas bills through ‘collective energy purchasing schemes’ whereby consumers sign up en masse with third-party organisations to get better deals from energy suppliers. The Minister has also written to energy suppliers to encourage positive engagement in these schemes.
“I want to help make collective purchasing become a permanent feature of the UK energy market. This can be a really useful tool for consumers by making it easier to move to a better deal and to get real savings on gas and electricity bills, as well as helping boost competition,” Davey explained.
“Now I want to see more providers coming up with schemes with the scale and reach to help the most vulnerable consumers. Local authorities and housing associations could have real role to play here, helping their tenants cope with living costs.”
The minister has offered the guidance after chairing a roundtable discussion with several businesses, consumer groups, local government groups, housing organisations, charities and energy regulator Ofgem.
Richard Bates, Director of Empowered Consumers at Consumer Focus, said: “Many consumers are put off by the prospect of having to switch energy by themselves. Collective switching – where an intermediary can do the hard work on their behalf – offers an alternative, straightforward way of switching. And because the intermediary can aggregate together consumer demand, it can give customers much more muscle in markets than they have when switching alone.
“Other countries have already shown that collective switching can deliver significant consumer benefits, chiefly greater convenience and better value. There is real scope for similar schemes to be developed in the UK and we hope many organisations will be interested in finding out how this innovative model can work in their area.”
Organisations attending the roundtable discussion included Age UK, Consumer Focus, the Independent Suppliers Forum, the Energy Retail Association, ichoosr, the Local Government Association, Moneysavingexpert.com, moneysupermarket.com, uswitch, the National Housing Federation, Ofgem, the Eden Project, thepeoplespower, and Which?.
