Weflip research reveals ‘myths’ about energy retail sector

Auto-switching service Weflip says research it has commissioned has revealed a number of “myths and misunderstandings” about the energy retail sector.

Weflip was also keen to stress its view that the price cap, which was introduced on 1 January, does not automatically represent a good deal for consumers.

According to the research 81 per cent of people say they want to cut their energy bills in 2019, but only one-fifth of households switch provider each year.

Meanwhile of the customers who switched supplier in the last 12 months, 83 per cent said they found the process “easy”.

Yet 5 per cent of those surveyed mistakenly believe their energy supply could be cut off during a switch of suppliers.

Of those surveyed 11 per cent thought having a smart meter installed would automatically reduce their energy bills.

Regarding prepayment meters, 9 per cent wrongly believed they could not switch energy provider if they are using a pre-payment meter.

A small proportion (2 per cent) mistakenly believed they were unable to switch because they were on an Economy 7 or Economy 10 tariff, while 17 per cent thought these tariffs provided cheaper gas and electricity prices.

Economy 7 and Economy 10 meters track day-time and night-time usage separately.

While the night-time rate is usually cheaper than during the day, Weflip says the day rate is often more expensive than on a normal tariff.  So, unless customers use a significant proportion of energy during the cheaper off-peak times, it can work out more expensive overall.

One in ten responded by saying they cannot switch energy provider if they live in a rental property.

Tenants who pay their energy supplier directly can usually switch suppliers, the exception is if the landlord pays the supplier for the energy used by the tenant.

The tenancy agreement will show who pays the bills and may show whether the landlord has a preferred supplier.  The tenant may have to return the account to the original supplier at the end of their tenancy.

Sally Jaques, head of energy at Weflip, said: “According to the energy regulator, Ofgem, 11 million households are paying through the nose for their energy bills because they are unnecessarily languishing on their providers’ most expensive tariffs.

“From the start of the year, the government introduced the energy price cap which will save the typical household £76 a year. However, we’re concerned that this could just become the latest in a series of energy myth-understandings, stopping people from saving even more money.

“Switching is much more straightforward than many people think.  To compare energy deals, all you need is your postcode, details of your current provider and the tariff you are on – which can be found on an old bill.”

Figures published today (21 January) show that 2018 was a “record year” for switching, with more than 5.8 million making a change.

This represents one in five customers and is a six per cent increase on the previous year’s record figures when 5.5 million customers switched electricity supplier.