You are here: Home - Household Bills - News -

Energy auto-switching sites ‘can leave customers paying more’

0
Written by:
03/03/2020
Energy switching sites claim to get customers the best deal, but an investigation reveals billpayers could pay up to £70 more than if they made the move themselves.

The first auto-switching service launched in 2016 and since then, a host of sites have popped up, monitoring the market, automatically moving customers to the best tariffs and taking care of the move for them.

While they claim to cover most of the market, some energy auto-switching services are comparing fewer than 15 out of around 70 suppliers.

This means some customers are paying £70 a year more than if they’d found a better deal and switched themselves, according to a report by charity Citizens Advice.

It found some were even listing firms that had gone bust while others were providing inaccurate or unclear information, making it difficult for consumers to make informed choices about using the service.

Around 300,000 people use auto-switching services and around seven million use third-party services including comparison sites, but they are not currently regulated.

Citizens Advice is calling on the government to ensure consumer protections are “fit for the future”, bringing them in line with other markets like insurance given the rapid growth of the market.

It said people can face serious problems which are difficult to resolve. In one case seen, an auto-switch site failed to cancel a switch, leaving customers stuck with a supplier they were unhappy with or facing exit fees. In another case, consumers lost some of the services they relied on as a result of being switched without warning.

‘Better safeguards for customers’

Gillian Guy, chief executive of Citizens Advice, said: “The lack of regulation leaves people facing potentially serious problems and a lengthy and difficult path to resolving them. As more people use these sorts of services, it’s essential that better safeguards for customers are put in place now.

“The government has an opportunity in the upcoming energy white paper to fix current problems and make sure the right consumer protections are in place as the UK moves to a zero-carbon future.”

Alex Dickson, head of research at auto switch site Switchcraft, said: “Auto switching has revolutionised the UK energy landscape by helping hundreds of thousands of households engage an overly complex utility market and cut their energy bills by some £80m.

“Switchcraft supports any new rules aimed at improving consumer access to better energy services and cheaper deals, including regulation for third parties. As with any new industry, not all players are getting it right all of the time.  And after decades of ring-fencing customers, energy suppliers are now coming to terms with a new more flexible switching system.”

See YourMoney.com’s Which energy switching firm is best for you? for more information.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Seven ways to get help with energy bills this winter

We knew today’s announcement was going to be painful, but it’s still a shock to the system. When this kick...

Flight cancelled or delayed? Your rights explained

With no sign of the problems in UK aviation easing over the peak summer period, many will worry whether holida...

Rail strikes: Your travel and refund rights

Thousands of railway workers will strike across three days this week, grinding much of the transport system to...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week