January saw ‘uncharacteristic dip’ in switching

Electricity switching got off to a “slow start” in 2021 as January saw the fewest amount of switches for that month in three years, Electralink has revealed.

The latest figures from the company’s Energy Market Data Hub (EMDH) recorded a total of 377,000 customers who changed their supplier in January, 23 per cent less than the previous month and 16 per cent less than January 2020.

Decreases in switches are typical from December to January, largely due to the Christmas period, but Electralink said the reasons behind the latest slump are not immediately clear.

The last time Electralink saw a drop of this magnitude was in January 2017.

Last month also saw 510,000 switches started which is 23 per cent less than January 2020.

The number of customers starting the switching process usually increases from December to January, but this year there were four per cent fewer switches in January than December. The last time this happened was also in January 2017.

In terms of switching types, all four categories are down on the previous month and only switching between small and medium sized suppliers increased compared to the same month last year.

• Large to large switches reached 172,000 – 20 per cent less than January 2020 and 46 per cent of January 2021’s total switches completed
• Large to other switches reached 104,000 – nine per cent less than January 2020 and 27 per cent of January 2021’s total
• Other to large switches landed at 56,000 – 25 per cent less than January 2020 and 15 per cent of January 2021’s total
• Other to other switches hit 46,000 – seven per cent more than January 2020 and 12 per cent of January 2021’s total

Electralink added that it expects to see rising switching activity in the coming months, following Ofgem’s announcement that the price cap will increase.

“Due to the uncharacteristic dip in changes of supplier started in January, this might not reflect in February’s reporting, but we expect more switches to show in March and April”, the company added.

Energy UK

Meanwhile Energy UK has published its first switching figures of 2021, also showing a 16 per cent decrease compared to January 2020.

However, the trade body recorded 374,350 customers switching supplier. This, it said, remains above the January five-year average of 360,000.

The organisation has previously said that discrepancies between the two sets of figures likely arise from differences in their definitions of switches, including when they are judged to have been completed, as well as the way they are reported.

In January 2021, of all domestic switches:

• 23 per cent were from larger to small and mid-tier suppliers
• 14 per cent were from small and mid-tier to larger suppliers
• 53 per cent were between larger suppliers
• 9 per cent were between small and mid-tier suppliers

Emma Pinchbeck, Energy UK’s chief executive, said: “Switching figures have become more unpredictable since the pandemic started – and January is often a slower month in terms of switching – but we are still seeing hundreds of thousands of customers taking steps to save money every month.”