Switching slumps almost a quarter in first month of 2021February 16, 2021
2021 has set off to a slow start for energy suppliers as last month racked up the fewest switches for a January since 2018.
According to ElectraLink’s Energy Market Data Hub (EMDH), 377,000 customers changed energy supplier in January 2021 – 23 percent less than December 2020 and 16 percent less than January a year before.
Decreases in changes of supplier (CoS) from December to January are typical, largely due to the holiday season, but the last time we saw a drop of this magnitude was in January 2017. The cause of this latest slump is not immediately clear.
CoS started also dropped uncharacteristically in January compared to December. January 2021 saw 510,000 switches started – 23 percent less than January 2020.
Usually, the number of customers starting the switch process increases from December to January. However, the latest data shows four percent fewer switches in January 2021 compared to December 2020.
The last time CoS started decreased from December to January was January 2017.
In terms of CoS types, all four categories are down on the previous month and only switching between small and medium sized suppliers increased compared to the same month last year.
- Large to Large switches reached 172,000 – 20 percent less than January 2020 and 46 percent of January 2021’s total switches completed,
- Large to Other switches reached 104,000 – nine percent less than January 2020 and 27 percent of January 2021’s total switches completed,
- Other to Large switches landed at 56,000 – 25 percent less than January 2020 and 15 percent of January 2021’s total switches completed,
- And Other to Other switches hit 46,000 – seven percent more than January 2020 and 12 percent of January 2021’s total switches completed.
With Ofgem’s recent announcement of an increase to the standard variable tariff price cap, we expect to see rising CoS activity in the coming months as customers change supplier to avoid being moved onto expensive default tariffs. Due to the uncharacteristic dip in CoS started in January, this might not reflect in February’s reporting, but we expect more switches to show in March and April.
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The above figures relate to electricity CoS in Great Britain only.
We do not include CoS from Supplier of Last Resort (SoLR) processes or trade sales in our monthly CoS reporting. We account for only voluntary switches, or instances where the customer made an active decision and took action to change supplier.
CoS started refers to the number of valid switches started, also known as CoS raised.
All data is provided by ElectraLink’s Energy Market Insights (EMI) from the EMDH.
ElectraLink has been granted the governance protections to hold, transfer and analyse CoS and other data.