Social Media Switching May End Poor Utility Deals

Collective switching by consumers between utility firms could finally end poor deals and unresponsiveness from suppliers, according to a report.

Consumer Focus said increased information and advice had not been enough to allow consumers to cut through confusion surrounding the different deals offered by energy, telecoms and financial service suppliers.

A study by the watchdog concluded that collective switching using social media could "shift the balance of power" from suppliers to consumers.

It said an intermediary body could register the demands of consumers using social media and combine them into a group big enough "that companies are unable to ignore".

More than half a million consumers in the Netherlands, Belgium and Germany have already registered with collective switching programmes for gas, electricity and heating oil.

Studies had shown that the average household saved between 200 and 250 euros (£163 and £204) for a dual fuel energy contract.

The first similar high-profile initiative in the UK launched by the Which? consumer group and campaigning website 38 Degrees had attracted more than a quarter of a million consumers.

Consumer Focus spokesman Richard Bates said: "This could be a great way to make consumers more powerful in some really important markets.

"In effect, collective switching has the potential for an intermediary, working on behalf of consumers, to turn inertia from something that works against consumers into a force that works for them."

Energy Secretary Ed Davey said: "I am very excited about the potential for this in the UK and I welcome the work Consumer Focus is doing on this."

Which? executive director Richard Lloyd said: "Which? research has found that the bewildering array of energy tariffs makes it virtually impossible for many people to work out what the best deal is.

"Collective switching has the potential to shake up the energy market and put more power in the hands of customers, but only if the energy suppliers play ball."