Businesses Warm to Energy Switching

A new survey has shown that businesses have an increasingly positive view of the process for switching between electricity and gas suppliers.

On 25 May, energy regulator Ofgem published research, prepared by analyst BMG, on Micro and Small Business Engagement in Energy Markets. It was based on 1,500 telephone interviews with businesses between October-December last year.

Switching up

The report found that nearly two thirds of businesses (64%) had switched gas or electricity suppliers in the past five years. The proportion of businesses that had switched supplier in the last 12 months increased slightly – up to 25% in 2015, from 23% a year earlier.

Just under half (47%) of all businesses have explored other supplier or tariff options in the last 12 months. While cost savings remain the key factor in firms’ decision to switch, other significant triggers include awareness that a contract is coming to end, and receiving a renewal notice from an existing supplier.

Just under half of businesses (48%) said they regarded comparing prices as easy, while nearly four in 10 (39%) felt the opposite way. The majority (61%) also believed that switching supplier was easy.

Supplier satisfaction

Two thirds of businesses were satisfied with their current energy suppliers’ services overall. Satisfaction was highest for the supplier meeting their customers’ business needs (72% satisfied), but lower for the information provided on available tariffs and options (51% satisfied).

However, around two fifths (39%) of businesses said they tended to distrust energy suppliers to be completely fair in their dealings with customers, while just over a quarter (26%) trusted them. A third of businesses said they were satisfied with the competitiveness of energy prices.

The research brought mixed news for the energy industry – increasing levels of consumer engagement are welcome but there clearly remain significant trust issues to overcome.