Which energy switching firm is best for you?
If someone said you could save £300 a year doing very little, wouldn’t you jump at the offer? Well, that’s exactly what firms that automatically switch you to a better energy deal promise.
Auto-switching energy companies compete with the price comparison sites but instead of simply listing the top deals, they monitor the market, automatically move you to the best tariff and take care of the switch for you.
One of the main players in the market Look After My Bills hit the headlines this week after landing a record deal on Dragons’ Den.
Co-founders Henry de Zoete and Will Hodson received offers from all five Dragons but ended up going with Tej Lalvani and Jenny Campbell who offered £120,000 for 3% of their business, the lowest amount of equity ever given away in the show’s 13-year history.
Campbell, a fintech entrepreneur, tweeted after the show: “I am super delighted to be on board with this fantastic business which will transform how people get the best deals for their household bills.”
But Look After My Bills isn’t the only auto-switcher. Several others have emerged in recent years with varying business models and pricing structures. Some, for example, are free to use, while others charge a monthly or annual fee.
But it shouldn’t just be about cost when it comes to picking an energy switching firm.
Gillian Guy, chief executive at Citizens Advice, told YourMoney.com: “To make sure customers get the best possible experience, these services should make sure the suppliers they recommend provide good customer service as well as an attractive price.”
Trade association Energy UK also said there’s more to energy switching than price.
“While auto-switching services may be able to help consumers find the lowest price, it is important that customers make a choice based on what is the best for them and we know for many people that might mean prioritising good customer service or choosing a green tariff,” a spokesperson said.
Here we look at the five big names in the auto-switching space:
Look After My Bills
Does it receive commission from energy firms for switches? Yes
Is it whole of market? The firm said it scopes the whole market for deals but excludes some energy companies if they are not happy with their customer service.
How many customers? 30,000+
How often are deals monitored? Fixed tariffs are reviewed when the deal comes to an end and variable tariffs are monitored on ‘a regular basis’.
How often are customers switched? Once a year. They’ll only switch a user when they’ve found a saving of at least £50. They don’t switch someone if there are exit fees to pay.
Can customers set their own parameters? Yes, if they want renewable energy or a supplier who offers the Warm Home Discount, for example.
What the company says: “We only work with trusted suppliers with excellent customer service and will not prioritise a few extra pounds in savings over sub-par service for our customers.
“We have years of experience and expertise in the sector on our side, with our consumer collective the Big Deal which started in 2014. In the last four years we have moved over £125m of energy custom and saved our members over £25m.”
Price: Switchd has three different pricing plans: £1.99/mo, £3.49/mo and £4.99/mo. It is also trialling a free version.
Does it receive commission from energy firms for switches: No but the free version would be commission based if it goes live.
Is it whole of market? The paid for options give you access to tariffs from the whole market. The free service would be limited to the deals found on price comparison sites.
How many customers? Low thousands
How often are deals monitored? Daily.
How often are customers switched? Every 6-9 months on average.
Can customers set their own parameters? Yes, the algorithm takes into account customer preferences like green tariffs, never paying exit fees and excluding certain suppliers. Customers can also set their minimum saving for a switch.
What the company says: “We’ll save you over £100 more than the free players by switching to the whole market. We have a free version as well but want to see you get the best deal.
“Our product is awesome. We have an app to submit meter readings, a dashboard to track your savings and a friendly team only a phone call away.”
Price: £25 a year ‘membership fee’
Does it receive commission from energy firms for switches? No
Is it whole of market? Yes
How many customers? 20,000
How often are deals monitored? Monthly but if they can’t save you money right away, they’ll keep checking for free and will only charge the annual £25 fee once they’ve found a saving of at least £50.
How often do customers switch? Members can be switched up to four times a year, once a saving of £50 has been found after any exit fees.
Can customers set their own parameters? No but if a customer wants to exclude a certain supplier they have the industry standard 14 day cooling off period to stop a switch and then ask to exclude that supplier from their preferences. Flipper will then start the process again to find them the next best deal from the rest of their suppliers.
They’re working on adding preferences such as green only tariffs into the sign up process.
What the company says: “We’re completely impartial. We charge you a membership fee because we don’t take commission, meaning every deal we find is really, truly the best deal available on the market.
“We have a brilliant customer service team who can guide people through this process as well as answering any flipping queries there may be. We aim to answer phone calls immediately – and don’t have one of those annoying ‘For such and such press 1’ systems.”
Does it receive commission from energy firms for switches: Yes
Is it whole of market? No, they currently have relationships with 50 suppliers
How many customers? Several thousand
How often do customers switch? Customers are switched when their plans come to an end. They say the main saving comes from avoiding expensive standard variable tariffs and customers are happy to switch once a year.
Can customers set their own parameters? Yes, users can set the following five parameters: green only, fixed price plans only, large suppliers only, plans without exit fees, plans with paper billing available.
What the company says: “We’re one of the only auto switch service to support prepayment meters, so our service is available to those that need it the most.
“Our technology is proven and scalable. Many other “auto switch” firms have some element of manual processing or have never organised repeat switches because they’re so new.”
Does it receive commission from energy firms for switches? Yes but they are paid via their partner Energyhelpline to maintain independence.
Is it whole of market? No
How many customers? Low thousands
How often are deals monitored? Monthly
How often are customers switched? Whenever there is a savings of at least £40 per fuel but they plan to launch a new feature very soon to let customers set their own minimum levels.
Can customers set their own parameters? Yes. They also ensure a customer maintains smart functionality if they have a smart meter.
What the company says: “Our service is more accurate – we have found that customers can get the wrong tariff recommendation more than 50% of the time if they estimate usage, as most price comparison services do. We are able to get their usage direct from the meter or industry data flows.
“While you don’t need a smart meter with Labrador, we can enable them to maintain smart functionality without being tied to the installing supplier.”