Gas and electricity Updated:
If you've been looking for ways to lower your energy bills recently, you may have come across a term known as "collective switching". It's touted as a way to save consumers money by asking providers to directly compete for their business, but just what is it, how does it work, and how could it reduce your energy bills? We take a closer look.
Collective switching is where a group of consumers get together to negotiate a better deal from energy suppliers. They do this by using their collective buying power – individual consumers don't generally have much power to negotiate, but a large group of customers do. As a general rule, the more people who are involved in the collective switch the bigger the discounts can be, so it could be well worth signing up.
The third party who runs the group will typically take control of the negotiation, and from there, energy providers will "bid" for their business. The supplier that offers the best deal will be chosen and an exclusive tariff will be developed to suit the needs of the group, and importantly, this tariff will only be available to those involved in the collective switch. It will usually be highly competitive, but as a general rule there'll be no obligation to switch, so consumers can choose to decline the offer if they wish.
All you have to do is sign up to the collective and let the providers compete for your business. That's it! It's a hugely simple process for customers, as the third party who organises the switch is responsible for the negotiation and will inform you of the specific details of the tariff, and will often take care of the entire switching transaction for those who decide to go ahead. Most schemes will offer the chance to compare the tariffs you're offered with those on the open market, too, making it easy to see whether or not you're truly getting a better deal.
Sound like something you want to get involved in? Well, you're in luck! Moneyfacts has partnered with energyhelpline.com to get a better gas and electricity deal for our readers, and it couldn't be simpler to get involved. All you have to do is sign up to the Moneyfacts Energy Collective Switch and register your details, all for free, and we'll use the power of the group to negotiate a great deal.
We'll notify you of the tariffs that are available from 19 October, complete with a comparison of all other deals available on the open market, and from there, you can decide if you want to go ahead. If you do decide to switch, we'll organise everything for free, but there's absolutely no obligation – it's all down to you!
While there's no guarantee with this kind of thing – it all depends on the number of consumers involved in the collective and how much individual providers are willing to negotiate – previous switching schemes have enjoyed plenty of success. For example, energyhelpline's last collective helped those who switched save an average of £295 per year on their energy bills with the winning deal costing an average of £885 per year, the cheapest available at the time, so you definitely have the chance to save a decent amount of money! It's all about the power of the collective, so get involved and see if you could get a better energy tariff.
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
Moneyfacts.co.uk will, like most other websites, place cookies onto your computer’s
hard drive. This includes tracking cookies.