Stick or twist: TPI views on switching

David Peake, a director of The Energy Brokers appeared in the recently published Directors’ Energy Report 2017 published by The Energyst. In his opinion, customers have “come around to the view that they will not make a significant saving [from switching] first time around”. For larger firms, “the real value” lies in consolidated billing while intermediate-sized business may be “under the illusion that they will receive greater bill savings than they will actually get”. Meanwhile, for “single site customers with a small level of consumption, it is going to be a negligible saving”. For those that do want to switch supplier, Peake advises a layered approach. “Rather than try to get a 2-5% saving from day one, we are advising clients to go shorter and also out of sync to the main round. Everyone is going to submit to an early [switching] round, assuming the market is ready,” he said. “But [instead switching all sites at once], we think it might be better to split portfolios, take some contracts out on a year, take some out on 18 months, some out on three years. That way, as the market develops greater liquidity, you start to see the benefit sooner. The lesson from Scotland is don’t take a 3% saving and lock out with that provider for three years. You would probably receive better value going shorter. So we are looking at whether we can devise a solution on that basis.”

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Source: The Energyst