Wave 6 - March 2020
The retail energy market - delivering a better deal for consumers?
The sixth wave of the Retail Energy Market Tracker coincides with the first full year of the energy price cap being in place. Despite price changes leading to a surge in energy switching during this first year, evidence from our Trackers suggests that energy customers have realised it isn’t a silver bullet for the retail energy market.
Despite increased switching and customer satisfaction over the past quarter, there has been a modest reduction in consumers’ overall experiences with the energy market in January 2020 compared to October 2019.
There were also further declines in cost metrics, as falls in wholesale prices were reflected in a 3% drop in the average cost of all tariffs and a 6% reduction to the price of the cheapest deal. These price reductions are likely to be the key factors behind increases in switching electricity supplier, over the quarter and over the year as a whole*.
Energy customers have again reported improvements in their experience of dealing with their supplier, both over the last quarter (+1pp) and the last 12 months (+6pp) – a significant year-on-year increase.
This continues the trend which emerged in October 2019, whereby higher levels of interaction appear to correspond with increases in consumer satisfaction – suggesting that regulatory intervention could have most impact if it focused on increasing prompts for bill payers to engage with the market.
With this tracker designed to quickly reflect changes in the market and consumer attitudes, the next wave of data should indicate what impact the COVID-19 pandemic has had on the UK market and customer engagement.
The retail energy market at a glance
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*Source: Uswitch data. Correct as at 24 January 2020. ***Source: Uswitch data. Consumer engagement, action, experience of suppliers, and confidence in switching. Criteria weighted equally, giving a score of 58% (-2pp from October 2019).