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Switches between energy suppliers reached their highest point since late 2021 in September.
Figures compiled by Electralink show 222,000 changes of supplier last month – the third month in a row the metric has exceeded 200,000.
September’s figure is 120% higher than the same month last year and 3% higher than August.
There have been 1.6 million switches so far this year, compared to 932,000 from January to September 2022.
Switching activity collapsed in the autumn of 2021 after a wave of exits from the energy retail market. While momentum has been building steadily for the past year monthly figures are still some way behind their peak in March 2021 when 650,000 customers changed supplier. Trade body Energy UK has previously said it sees no sign switching numbers will return to their historic high in the near future.
September’s figures show the majority of switches (56%) were among large suppliers, followed by large to ‘other’ at 22% and the opposite direction accounting for 16%. Just 6% of switches did not involve large suppliers at all.
Electralink suggested more activity is likely to come as October’s price cap reduction – to £1,923 for the average duel fuel household bill – filters through. However, analysts have predicted a rise in the cap in 2024. Ofgem announced last week that bills would increase by c.£17 from next April because of moves to mitigate bad debt pressures on suppliers.
The regulator has also said it will remove the market stabilisation (MSC) charge from next March, which is likely to have an impact on how aggressively suppliers are seeking to recruit new customers. This mechanism sees suppliers pay the losing company when they acquire a new customer, but only if wholesale prices fall significantly below the level assumed in the price cap.
Ofgem is still considering whether the ban on acquisition-only tariffs, which was introduced at the same time as the MSC, should also come to an end. It is currently weighing up the trade-offs of the ban on consumer protection and switching activity.
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