A new report from the Commission for Regulation of Utilities (CRU) has revealed some interesting facts and stats concerning the energy market. The most compelling statistic proves the saving power of switching, as it was revealed that an average customer switching supplier over the last four years would have saved almost €1,700 euro!
The CRU’s annual electricity and gas retail market report for 2018 was recently released and comes bursting with interesting info concerning the development of competition in the electricity and gas markets over the last year.
We know you’re a busy reader, so let’s not get too bogged down with the extensive specifics of the report, and cut right to the chase to reveal the most compelling details for the average energy customer; namely, those that can help you save you time and money!
The monopoly is breaking down
For the second year in a row since the energy market was deregulated a few years ago, Electric Ireland (formerly ESB) saw its market share below 50%, with the company now holding 48.7% of the market, down from 49.5% last year.
Bord Gáis Energy continued to hold the second greatest market share by consumption in Q4 2018 with 18.40% (though it still holds the greatest gas market share with 45.2%, though this is slightly down on last year).
SSE Airtricity is in third place in the electricity market with 13.60% market share with Energia next on 8.9%.
There are now nine electricity and eight gas suppliers in the Irish residential market (with seven of those offering dual fuel options), which is great news for consumers - more competition means more choice!
Loyal no more - Ireland reveals its appetite for switching value
Since the energy market was deregulated and more options have become available to energy customers, levels of switching have continued to increase.
For 2018, the electricity switching rate was 14%, while the gas switching rate was 20%, up 2% on last year. This is the highest gas switching rate recorded to date. Of total switches, 29% were dual fuel switches.
Switching rates in both the electricity and gas markets in Ireland rank well in global terms.
The total number of switches completed in the electricity market in 2018 was 331,900. This represents an increase of 4.2% from 2017, when 318,596 customers switched.
The total number of switches completed in the gas market in 2018 was 137,125. This represents an increase of 10.2% when compared with 2017, where 124,419 switches were completed.
This means almost 1,300 people switched energy supplier every DAY last year in Ireland.
In addition to switches between suppliers, approximately 9.1% of electricity customers and 9% of gas customers renegotiated their contracts with their current supplier in 2018, which is a small increase from 2017.
Why are people switching?
So if the above data tells us anything it’s that Ireland has developed an appetite for switching.
And for those of us in the know, we're aware that there’s a simple reason for so much supplier hopping. It’s simple. It’s easy and it saves money.
According to the CRU, if a customer had switched to the best available discount tariff each year for the past four years they could, over the course of the four years, potentially have saved up to €1,097 on electricity; €704 on gas; and €1,696 on dual fuel.
Of course, there are other driving factors besides price (though price is undoubtedly the main one). For example, green energy is becoming an important factor in customer decisions, with 43% of customers last year claiming that a supplier’s capability to provide energy from renewable sources would influence their choice of supplier.
Switching might be up, but not nearly enough…
Though overall the 2018 consumer survey found high levels of customer satisfaction with all suppliers, levels of knowledge and awareness across customers in terms of tariff structures, energy offers and bill configuration are low.
The survey also found low levels of repeat switching. Data suggests that of those who switched supplier in the last 12 months 48% (domestic electricity) and 37% (domestic gas) defaulted to a standard tariff when their initial discount period ended.
We’re not surprised concerning these two findings in particular - energy tariffs and discount price plans can be tricky to figure out when you’re trying to do it on your own! It’s why comparison website like bonkers.ie exist - to make the switching process as quick and easy as possible.
Now, here’s why you need to switch every year:
Most of Ireland’s suppliers offer heavily discounted rates to their new gas and electricity customers as a sign-up incentive. This means when you sign up as a new customer you’ll get a discount on your energy bills for a predetermined period of time, typically the length of a standard contract (12 months).
When this period comes to an end i.e. when your contract is over, if you don’t switch, your supplier will revert your plan to standard pricing and you’ll pay more for the exact same service.
So, if you remember to switch suppliers every year, you’ll ensure that you’re always on a discounted rate, which means you’ll never pay over the odds and you’ll always get the very best value for your money. No brainer, right?
Ready to check out your options?
If you haven’t switched energy suppliers in the last 12 months, you’re almost definitely paying more than you have to. Why not check out our energy price comparison calculator and see how much money you could save?
