Last week (June 16th) “thisisthebigdeal” announced they had negotiated the first market beating tariff that can’t be found on a comparison site. Whether this is the first time a collective energy switching scheme has delivered a market beating tariff is questionable (Which? claim they did so in 2012) – but nevertheless this is a great success for collective switching.
As our members know (and you have been able to see from our homepage for the last 9 months or so, we have been encouraging people to switch with our comparison service (http://switch.cheaperenergytogether.org). So why have we stopped doing collective switches?
A bit of background
Some months ago the folks at DECC (Department for Energy and Climate Change) contacted us and all the other collective energy switching services they knew about and told us about the “This is the Big Deal” outfit and encouraged us to get in touch with them. We duly got in touch and offered to send the deal out to our members … as long as it was better than what we can offer via a comparison service with cash back. We thought people who signed up with us would appreciate being alerted to a better offer than we had. (But course, we were not offering to send out our members contact details).
Over the last few weeks we have been told that the “big deal” switch would be massively better than anything on the market …. so we have been eagerly awaiting the results.
We really want collective switching to offer the best tariff … but thought you’d appreciate us checking it carefully before encouraging people to use it.
A bit of checking
We started checking as soon as the deal came out – and were very disappointed to see that the “deal” looked pretty poor – we got in touch to report our findings – only to discover that the initial offer calculator was faulty … so we re-checked when their faulty calculator was corrected .
As “the big deal offer” does not give people a market comparison we did a thorough check – after all we don’t want to encourage people to accept an offer that is not the best on the market.
The offer they have (from Green Star energy) is a 2 year fixed deal – and for an average user on gas and electricity works out at about £10 cheaper than the existing 2 year fixed deal from the same company.
As we give £10 cash back per fuel switched – we can offer pretty much the same deal – but crucially alongside a full market comparison so people with either very high or very low usage get to see alternative (and often better offers)
However, there are a lot of one year to 18 month fixed deals on offer that are significantly cheaper than this 2 year fixed deal on offer (all with £10 cash back per fuel switched from us) – meaning on balance we think the vast majority of people will save more if they switch with us.
We have reviewed every collective switch so far, and no collective switch has saved more money than a full market comparison with cash back
In short – a great effort … but they have not beaten a full market comparison with cash back from us.
Why bother with a market comparison
We have agonised over this over the last few years. Despite some efforts from Ofgem and DECC to simplify energy tariffs, tariffs are still far too complicated to compare without a market comparison. We have repeatedly told DECC and Ofgem to make energy tariffs so simple that people don’t need an expensive comparison service to see the best deal. But there is no enthusiasm to do this. DECC and Ofgem say they want to leave the energy market to “innovate” for our (consumers) benefit. However all this innovation really means is that people have no idea which energy tariff is best for them without doing a full market comparison engine to see what deal is best. This adds unnecessary confusion and costs to consumers.
In short, unless someone can negotiate a bigger saving from a collective energy switch, people are better off using our price comparison with cash back.
So grab some recent energy bills and Switch Now!